oussama94
05-28-2017, 23:20
There are 10 more members slated to adopt the euro over the next
few years. The enlargement, which will grow the EMU’s population by
one-fifth, is both a political and an economic landmark event: Of the new
entrants, all but two are former Soviet republics, joining the EU after 15
years of restructuring. Once assimilated, these countries will become part
of the world’s largest free trade zone, a bloc of 450 million people. Consequently,
the three largest accession countries, Poland, Hungary, and the
Czech Republic—which comprise 79 percent of new member combined
GDP—are not likely to adopt the euro anytime soon. While euro members
are mandated to cap fiscal deficits at 3 percent of GDP, each of these three
countries currently runs a projected deficit at or near 6 percent. In a probable
scenario, euro entry for Poland, Hungary, and the Czech Republic are
likely to be delayed until 2009 at the earliest. Even smaller states whose
economies at present meet EU requirements face a long process in replacing
their national currencies. States that already maintain a fixed euro exchange
rate—Estonia and Lithuania—could participate in the ERM earlier,
but even on this relatively fast track, they would not be able to adopt the
euro until 2007
few years. The enlargement, which will grow the EMU’s population by
one-fifth, is both a political and an economic landmark event: Of the new
entrants, all but two are former Soviet republics, joining the EU after 15
years of restructuring. Once assimilated, these countries will become part
of the world’s largest free trade zone, a bloc of 450 million people. Consequently,
the three largest accession countries, Poland, Hungary, and the
Czech Republic—which comprise 79 percent of new member combined
GDP—are not likely to adopt the euro anytime soon. While euro members
are mandated to cap fiscal deficits at 3 percent of GDP, each of these three
countries currently runs a projected deficit at or near 6 percent. In a probable
scenario, euro entry for Poland, Hungary, and the Czech Republic are
likely to be delayed until 2009 at the earliest. Even smaller states whose
economies at present meet EU requirements face a long process in replacing
their national currencies. States that already maintain a fixed euro exchange
rate—Estonia and Lithuania—could participate in the ERM earlier,
but even on this relatively fast track, they would not be able to adopt the
euro until 2007