News Release
Pedro Solbes
No. 14/04
February 4, 2004
EU ENLARGEMENT AND THE EURO
EU Economic
and Finance Commissioner
Pedro Solbes said in Prague yesterday that the
ten new countries*
joining the EU on May 1 would have three principal challenges on the road to adoption
of the euro. The text is available at:
http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=
gt&doc=SPEECH/04/53|0|RAPID&lg=EN&displ ay
“The ten Acceding Countries are now only a few months away from membership of
the Union. And the
next landmark is moving into sight. After fulfilling the necessary conditions,
the new Member States will eventually adopt the
euro, replacing their own national currencies.”
Convergence:
“In the context of accession, the countries must further prepare their economies
for integration into the EU. This means pursuing policies favoring real convergence.
It will be especially important to continue with structural reforms on product,
capital and labor markets. This will improve the flexibility of their economies
and will strengthen the ability to cope with shocks to economic activity and employment.”
Public Finances:
“The
Acceding Countries need to reform and consolidate their public finances. Over
the coming years, fiscal policy will face particular challenges. On the one hand,
fiscal policy will need to support the catching-up efforts. This includes coping
with expenditure pressures stemming from the completion of transition reforms,
from compliance with the Community acquis and from the need for further infrastructure
investments. On the other hand, public finances will have to underpin macroeconomic
stability by remaining on a prudent path and avoiding imbalances. Sound public
finances are also for the new Member States a pre-requisite to address the longer-term
challenges of ageing populations.”
Financial Supervision:
“Countries need both a strong framework for financial supervision, and a careful
judgment of their needs for exchange rate flexibility and independent monetary
policy.”
* Countries joining the EU on May 1, 2004 are Cyprus, the Czech Republic, Estonia,
Hungary, Latvia, Lithuania, Malta, Poland, the Slovak Republic and Slovenia.
