Croatia is ready to adopt the euro on 1 January 2023, the European Commission concluded on Wednesday in a review of the country’s preparedness to join the single currency area. The conclusion is set out in the 2022 Convergence Report, which assesses progress made by Bulgaria, Czechia, Croatia, Hungary, Poland, Romania and Sweden towards joining the euro area. These are the seven non-euro area Member States that are legally committed to adopting the euro.
The Report marks a crucial and historic step on Croatia’s journey towards adopting the euro, taking into account factors relevant for economic integration and convergence including balance of payments developments and integration of product, labour and financial markets. The EU Council will make the final decisions on Croatia’s euro adoption in the first half of July, after discussions in the Eurogroup and in the European Council, and after the European Parliament and the ECB have given their opinions.
The 2022 Convergence tReport concludes that:
- Only Croatia and Sweden meet the price stability criterion.
- All Member States fulfil the criterion on public finances, except Romania which is the only Member State subject to an excessive deficit procedure.
- Bulgaria and Croatia are the two Member States fulfilling the exchange rate criterion.
- Bulgaria, Croatia, Czechia and Sweden fulfil the long-term interest rate criterion.
- The Report finds that Croatia fulfils the four nominal convergence criteria and its legislation is fully compatible with the requirements of the Treaty and the Statute of the European System of Central Banks/ECB.
The Commission’s assessment is complemented by the European Central Bank’s (ECB) own Convergence Report, which has also been published today.