ADOPTION OF THE EURO

All countries that join the EU will be expected to adopt the euro as soon as they can. But it will not generally be immediate. The paragraphs below are taken from the official EU website at europa.eu.int/comm/enlargement/faq/print-faq2.htm

Will the new members adopt the euro – and when?

According to the EU membership criteria, new members must be able to demonstrate the "ability to take on the obligations of membership including adherence to the aims of political, economic and monetary union." The future members are thus expected to adopt the euro when they are ready to do so, but not immediately upon accession.

The adoption of the common currency by a country, following accession, demands the respect of detailed conditions. This involves three stages:

• the current, pre-accession stage, during which the applicant country must demonstrate irreversible progress towards a functioning market economy and competitiveness as well as sustainable macroeconomic stability;
• an intermediary phase between accession and the adoption of the euro, in which the new member participates fully in the Single Market, demonstrates progress towards achieving the conditions necessary to adopt the euro, including participation in the exchange-rate mechanism;
• participation in the euro area, provided the new member fulfils all the criteria that apply to current members for the adoption of the single currency (a budget deficit of less than 3 % of GDP, a debt ratio of less than 60 % of GDP, low inflation and interest rates close to the EU average).

So far, several of the applicant countries have made good progress towards these goals, at the same time strengthening their economic reforms.

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