Slovakia becomes eurozone member

[Winner]

So, our bratia Slovaks have adopted the Euro as their national currency and they've officially become our guinea pig It's the first former WP country which has adopted it and it is very close to us and the Poles, so everybody will watch how it affects their economy.

Sceptics say that they adopted it too soon and that it will hinder their economic growth, which has been among the highest in Europe (a heritage of the previous center-right government), and increase the inflation in the country.

Optimists believe that Euro will help the Slovak exporters and shield the small economy from the financial crisis. Of course it will also make it a bit easier for Slovaks to travel to other Eurozone members.

Thoughts, comments, criticism?

Slovakia becomes eurozone member
Slovakia has become the 16th member of the eurozone - the second former communist country to do so.

The Slovak koruna (crown) will remain in circulation alongside the euro until 16 January. Banks plan to open on Thursday, to swap korunas for euros.

Slovaks are now able to obtain euros from cash machines.

Slovakia sees its adoption of the euro as a shield from the turbulence that has hit currencies in neighbouring ex-Soviet bloc countries.

The koruna has been pegged at a rate of 30.126 to the euro since July, while Poland's zloty has lost 24% against the euro, the Czech koruna 11% and the Hungarian forint 13%, Bloomberg news reports.

A recent poll in Slovakia's Hospodarske Noviny daily showed 58% of respondents in favour of the euro, compared with 43% positive a year ago.

Euro "starter packs" have already been distributed in Slovakia and a big campaign has been under way to familiarise the nation of 5.4 million with the new currency.

Slovakia has enjoyed rapid economic growth since joining the European Union in 2004.

But the euro's strength may make life harder for Slovakia's exporters - particularly its big car industry - in the current economic downturn, correspondents say.

Slovakia's cabinet is counting on 4.6% economic growth, down from a peak of 10.4% in 2007, Reuters reports.

The small Alpine nation of Slovenia, formerly part of Yugoslavia, was the first ex-communist country to join the euro in its own right, two years ago.

However, the former East Germany - now part of Germany - has been involved in the euro project since the beginning.

 

[dosed150]

so is slovakia going fast or is the czech republic taking its time to change to the euro? i just would have of assumed it would be the richest country that would join first

 

[Enkidu Warrior]

As I understand it, the economies of Eastern Europe are tanking in general regardless of eurozone membership, so won't it be difficult to present this as a success given the already existing negative climate? I suppose if Slovakia can demonstrate a less catastrophic economic crash than the rest of Eastern Europe then this could be sold as a success for the Euro, but while that might make sense rationally I think it will be a tough sell practically.

 

[Winner]

so is slovakia going fast or is the czech republic taking its time to change to the euro? i just would have of assumed it would be the richest country that would join first

Well, Slovak economy is smaller and even more dependant on exports to the EU, so I guess it's more important to them. Also, the Slovak crown is a new currency, they don't really mind changing to another one. Some Czech expects believe that the monetary policy should remain in Czech hands until the period of fast economic growth ends.

But our PM said just a hour ago, that this year the Czech gov. will officially announce the date when we adopt Euro.

 

[Winner]

As I understand it, the economies of Eastern Europe are tanking in general regardless of eurozone membership, so won't it be difficult to present this as a success given the already existing negative climate? I suppose if Slovakia can demonstrate a less catastrophic economic crash than the rest of Eastern Europe then this could be sold as a success for the Euro, but while that might make sense rationally I think it will be a tough sell practically.

Uhm, what crash? And where? Slovakia is very different from Eastern Europe (Ukraine, Russia) where the markets are in freefall. Except Hungary, the financial crisis has not hit any post-commie Central European country. We're gonna be hit by the drop in demand in Western Europe, especially the car industry is going to face hard times. But a crash? No.

 

[Yoda Power]

When I first found out about this I was surprised. I didn't knew Slovakia had advanced that quick. But good for them, it's always nice having another member joining.

 

[Winner]

When I first found out about this I was surprised. I didn't knew Slovakia had advanced that quick. But good for them, it's always nice having another member joining.

When will Denmark join, BTW?

Slovakia has been preparing for this for a long time, the whole thing has been started by the previous government and the next left-wing Fico government continued in it.

I suppose that improvement of the image of Slovakia abroad was a part of their motivation.

 

[Yoda Power]

When will Denmark join, BTW?

When the Social People's Party finally accept the EMU, and we have a voting where they support it.

Within the next 2-6 years I think.

 

[kronic]

That is, if the € survives.

 

[Rossiya]

I'm happy for the Slovakese.

 

[Winner]

I'm happy for the Slovakese.

Slovaks or Slovakians. Ako sa opovažuješ?

 

[Rossiya]

Rzymyvm myvryrzm!

 

[Cato the Elder]

That is, if the € survives.

Why wouldn't the Euro survive?

I honestly haven't seen any sign of it falling except for typical Euroskeptic doomsday prophecies. (the same that exist during times of non-crisis)

 

[Jan H]

On the contrary, I think the Euro has been a blessing in the current financial crisis, especially for my own country, but probably also for the other smaller members of Euroland.

 

[Winner]

The question here is if it's good for CE countries, which have their economic cycles a bit "out of sync" with Western European economies. We'll see, that's why I am happy that Slovaks volunteered for this experiment. At least we can learn from their experience.

 

[Riffraff]

That is, if the € survives.

Also, if no giant meteorite strikes the earth...

On topic: good stuff!

 

[emzie]

Well, Slovak economy is smaller and even more dependant on exports to the EU, so I guess it's more important to them. Also, the Slovak crown is a new currency, they don't really mind changing to another one. Some Czech expects believe that the monetary policy should remain in Czech hands until the period of fast economic growth ends.

But our PM said just a hour ago, that this year the Czech gov. will officially announce the date when we adopt Euro.

Random aside, I found a 500 Czech koruna note outside my bank the other day.

 

[Godwynn]

I love the Euro.

 

[Winner]

Random aside, I found a 500 Czech koruna note outside my bank the other day.

31.6 Canadian dollars. I have no idea what you can buy for that in Canada, but it's roughly enough to drink all night here

 

[uppi]

I wonder how long it takes until I have the first Slovak coins in my wallet.