While Poland is still dreaming about adoption of the Euro in 2012, eight years after joining the EU, its tiny-weeny, titchy-witchy neighbour to the south, Slovakia, is using the Euro as of Jan 1 2009. The even smaller nations of Slovenia, Cyprus and Malta have also joined in the last year or two.
I confess I’m not an expert in Euro adoption but I do know that Poland already satisfies all of the convergence criteria except for the easiest one of all – the requirement to be within the ERMII mechanism for two years before Euro adoption. As it stands then, the earliest Poland could have the Euro is some time in 2011 (as has been suggested by the Tusk camp) but most likely would be Jan 1st 2012 assuming it joins ERMII on Jan 1st next year. By no means a foregone conclusion.
For Poland of course, meeting all the criteria is just a side-show compared to the political bickering and in-fighting that needs to go on around the subject. The main stumbling block seems to be the fact that the constitution must be changed to allow the Euro to be adopted. To change the constitution needs cooperation between the government and the Kaczynski brothers (definitely PiS but I’m assuming the President can also derail constitutional matters?). What are the chances of that happening – I’d say roughly zero. For example – Ducky Jarosław is determined that there should be a referendum about adopting the Euro. Tusk is equally determined that there is no need for one because Poland has already committed itself to adopt the Euro when it joined the EU. We have presidential elections in 2010 (Hallelujah!) and parliamentary ones in 2011 – how will that change the scenery?
So we have a country that, as far as I can tell is an absolutely ideal candidate for joining the Euro at the earliest opportunity and yet is taking far too long to do so thanks, in the most part, to its leadership sacrificing the countries needs for the sake of their own egoistic bickering! Why do I think Poland is an ideal candidate for the Euro? Primarily because:
- From what I can see, Polish citizens are not terribly hung up about keeping the zloty. Perhaps all those years where “hard currency” dollars were far more valuable? Perhaps the fact that the zloty has never really been one of the world’s premier currencies….I don’t know. This contrasts very strongly to the UK where they are incredibly hung up about keeping the pound, even if it does mean you need to buy reinforced trouser pockets to hold the 70 kilos of change you have to carry around!
- A large percentage of people already show a preference for foreign currencies, even or especially, for bigger transactions. More than a quarter of all mortgages are not in zloty, for example. Euro adoption would at least remove the confusion about which foreign currency is the best one – Euro, Swiss Franc, Dollar…. This just doesn’t happen in the UK, everything is in GBP.
- Many links between Poland and Euro currency nations. Even just the physical proximity of Euro-people is far more keenly felt than on that isolated island of Brits.
Business leaders have welcomed the government’s commitment to bring Poland into the euro zone in 2011. “The adoption of the euro will make life much easier for entrepreneurs, especially those who do business with the euro zone,” said Andrzej Arendarski, head of the Polish Chamber of Commerce (KIG). “They will no longer need to constantly monitor exchange rates and incur costs associated with currency exchange. The risk of losses caused by exchange rate changes will also disappear once the single currency is adopted.”
The Association of Polish Exporters says an early entry to the euro zone would make Polish exports more profitable and competitive. Business Centre Club experts say the benefits of adopting the euro for Poland would include faster economic growth, easier handling of increased tourist traffic and more efficient preparations for the Euro 2012 soccer championships.
According to a survey by the PBS polling company for the Gazeta Wyborcza daily, around 35 percent of respondents support the government’s plan to replace the zloty with the euro in 2011; one in four would prefer Poland to adopt the euro later than 2011; and 31 percent do not want Poland to adopt the single European currency at all. Meanwhile, in a survey by TNS OBOP for the Dziennik daily, 50 percent of people questioned said they would like their country to switch to the euro.
Anyway. Whether Poles want it or not, whether it would be good for Poland or not, we seem to be stuck with watching the usual Punch & Judy show rather than doing something that might actually be a good thing for the country and its citizens. In the meantime you can look forward to using those nice Slovakian Euros for your (more expensive) skiing holidays on the other side of the Tatras and just dream about those even better looking John Paul II, Polish Euro coins!