Poland and the euro

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eurozone participation
  European Union member states (eurozone) – 18
  European Union member state in ERM II scheduled to join on 1 January 2015 – Lithuania
  European Union member states not in ERM II but obliged to join – 7
  European Union member state in ERM II with an opt-outDenmark
  European Union member state not in ERM II with an opt-out – United Kingdom
  non-European Union member states using the euro with a monetary agreement – 4
  non-European Union member states using the euro unilaterally – 2

Poland does not use the euro as its currency. However, under the terms of their Treaty of Accession with the European Union, all new Member States "shall participate in the Economic and Monetary Union from the date of accession as a Member State with a derogation", which means that Poland is obliged to replace its currency, the złoty, with the euro eventually.

There is no target date for Polish euro adoption, and no fixed date for when the country will join ERM-II (the fifth euro convergence criteria). However, the government of Poland plans to comply with all the euro adoption criteria by 2015, and the governor of the Polish Central Bank has stated that the country will not join before 2016.[1] Euro adoption will require the approval of at least 2/3 of the Sejm to make a constitutional amendment changing the official currency from the Złoty to the euro.[2] The opposition Law and Justice Party opposes euro adoption and the governing parties do not have enough seats in the Sejm to make the required constitutional amendment.[3][4] PM Tusk has said that he may agree to a referendum on euro participation in order to gain their support for a constitutional amendment. Public opinion is against participation according to polls, with more than 70 percent believing that it would be bad for the Polish economy should it be adopted now according to one poll from September 2012.[5]

There is not yet any official information on the design process for the Polish national sides of the euro coins.

Political preparations for euro adoption[edit]

Article 227[6] of the Constitution of the Republic of Poland will need to be amended to allow a change of currency from the Złoty to the euro and a change of the central bank,[7] so there is no guarantee in regards of when Poland will choose to adopt the Euro. As of May 2011, the constitution had not yet been changed, and it was doubted the ruling government could establish a superior majority (2/3) in the current Polish Parliament, for this needed constitutional change.[8]

On 10 September 2008, speaking at the launch of an economic forum in a Polish resort of Krynica-Zdrój, Polish Prime Minister Donald Tusk announced the ruling government's objective to join the Eurozone in 2012. However, since the Polish constitution will need to be changed first[7] and they will have to join the ERM 2 before second quarter 2009,[9] a target date that is still very aggressive. Regardless, on 28 October 2008 the Polish government confirmed their plan to join the Eurozone in January 2012.[10]

On 5 November 2009, speaking at the news conference Polish Deputy Finance Minister Ludwik Kotecki said the government may announce a national strategy for euro adoption in mid-2010.[11] In an interview for Rzeczpospolita daily 22 October 2009 he also said Poland could adopt the euro in 2014 if the general government deficit is reduced in 2012.[12]

Former President Lech Kaczyński said on news conference that Poland was unable to join Eurozone before 2015, and even that date was still very optimistic. Also, Polish government officials had confirmed that Poland wouldn't join Eurozone in 2012.[13]

On Friday, 11 December 2009, Polish Prime Minister Donald Tusk said Poland could join the eurozone in 2015.[14] Speaking during Finance Ministry-organized seminar on the euro-adoption process on 15 December 2009 Deputy Minister of Finance Ludwik Kotecki said the year 2015 is more likely than 2014, however he declined to specify the official target date.[15]

In the years following the 2008 Global Financial Crisis, economic statistics showed that the devaluation of its floating currency the zloty led Polish products to became more competitively priced to foreign buyers, and because of that Poland had a higher economic GDP growth in subsequent years than if the country had been a part of the eurozone.[citation needed] The Polish government advocated in 2012 that it would only be wise for Poland to join the eurozone once the euro crisis had ended, based on the argument that delaying their accession would minimise the risk for Poland to become one of the net financial creditors to other eurozone countries in financial difficulties.[1]

In December 2011 Polish foreign minister Radosław Sikorski said that Poland aimed to adapt the euro on 1 January 2016, but only if "the eurozone is reformed by then, and the entrance is beneficial to us."[16] As of August 2012, there is still no official or binding target date for the Polish euro adoption, and no fixed date for when the country will join ERM-II (the fifth convergence criteria). The current Polish government plans to comply with all the Euro convergence criteria by 2015.[1]

In autumn 2012 the Monetary Policy Council of the Polish National Bank published its official monetary guidelines for 2013, confirming earlier political statements that Poland should only join the ERM-II once the existing eurozone countries have overcome the current sovereign-debt crisis, to maximise the benefits of monetary integration and minimise associated costs.[17] The governor of the National Bank, Marek Belka, has stated that the euro won't be adopted before the end of his term in 2016.[1]

In late 2012, Tusk announced that he planned to launch a "national debate" on euro adoption the following spring, and in December 2012 Polish Finance Minister Jacek Rostowski said that his country should strive to adopt the euro as soon as possible. However, the opposition Law and Justice Party opposes euro adoption and the governing parties do not have enough seats in the Sejm to make the required constitutional amendment.[3][4] In January 2013, Polish President Bronislaw Komorowski stated that a decision on euro adoption should not be made until after parliamentary and presidential elections scheduled for 2015, but that in the meantime the country should try to comply with the convergence criteria.[3] In February 2013, Jaroslaw Kaczynski, leader of the Law and Justice Party stated that “I do not foresee any moment when the adoption of the euro would be advantageous for us" and called for a referendum on euro adoption.[18] Rostowski has stated that Poland won't set a target date for the switch since the country first needs to carry out reforms to prepare itself.[19] In March 2013, Polish PM Tusk said for the first time that he would be open to a referendum on euro participation.[20] In April 2013 Belka said that Poland should demand to be permitted to adopt the euro without first joining the ERM-II, one of the adoption criteria specified by the EU treaties, due to concerns over currency speculation.[21] Following the 2014 Russian military intervention in Ukraine, Belka said that Poland needed to reevaluate it's reluctance to join the eurozone.[22][23]

The euro adoption process in Poland is regulated by the Strategic Framework for National Euro Changeover Plan (adopted by the Council of Ministers in 2010) and the National Euro Changeover Plan (approved in 2011 by the Committee for European Affairs). The plan comprises an economic impact assessment of the euro adoption, followed by a chapter on the measures needed to ensure Polish compliance with the "Maastricht convergence criteria", and finally a roadmap for the euro changeover process. One of the key details investigated as part of the work to update the plan is whether or not Poland will need to pass a constitutional amendment to pave the way for the euro changeover.[24] On 21 December 2012 it was announced by the Ministry of Finance that they planned to update the country's National Euro Changeover Plan in 2013, mainly due to the recent institutional changes in the eurozone which require additional considerations. The Polish Finance Minister emphasised that the government's support for euro adoption remain unchanged as a strategic goal, and will not be changed in the updated plan.[25] At the same time, however, recent turbulences in the EU and in the world have caused the government to adopt a kind of additional criterion for euro adoption, namely the stabilization of the euro area.[26]

Public opinion[edit]

In 2010, the eurozone's debt crisis caused Poles' interest to cool, with nearly half of the population opposed to entry.[27] In March 2011, research by CBOS showed that 60% of Poles were against adopting the euro while 32% were supportive, a decrease from 41% in April 2010.[28] Surveys in the first half of 2012 indicated that 60% of Poles were opposed to adopting the common currency.[29] Public support for the euro continued to fall, reaching record lows in the CBOS polls from July 2012, where only 25% of those polled supported a switch to the euro.[30] Another poll conducted by TNS Polska for the newspaper Gazeta Wyborcza on 10–13 May 2012 showed that support for euro adoption depends on the target date, with 13% in favour of adoption in 2014, 38% which prefer adoption at the earliest in 2015, and 28% that felt that the country should never join the eurozone. In the same survey 58% of the Poles had the opinion that euro adoption would negatively impact the Polish economy.[31] According to a poll for the German Marshall Fund published in September 2012, 71% of Poles believed that switching to the euro at present time could be bad for the Polish economy.[5]

According to a eurobarometer poll in April 2014, 45 per cent of Polish people are in favor of introducing the euro while 53 per cent are opposed.[32]

Admittance criteria[edit]

The Maastricht Treaty originally required that all members of the European Union join the euro once certain economic criteria are met. By April 2014, Poland met 3 out of the 5 criteria.


Convergence criteria
Assessment month Country HICP inflation rate[33][nb 1] Excessive deficit procedure[34] Budget deficit to GDP[35] Debt-to-GDP ratio Exchange rate Long-term interest rate[36][nb 2]
ERM II member[37] Change in rate[38][39][nb 3]
2012 ECB Report[nb 4] Reference values max. 3.1%[nb 5]
(as of 31 Mar 2012)
None open
(as of 31 March 2012)
max. 3.0%
(Fiscal year 2011)[41]
max. 60%
(Fiscal year 2011)[41]
min. 2 years
(as of 31 Mar 2012)
max. ±15%[nb 6]
(for 2011)
max. 5.80%[nb 7]
(as of 31 Mar 2012)
 Poland 4.0% Open 5.1% 56.3% No -3.2% 5.77%
2013 ECB Report[nb 8] Reference values max. 2.7%[nb 9]
(as of 30 Apr 2013)
None open
(as of 30 Apr 2013)
max. 3.0%
(Fiscal year 2012)[43]
max. 60%
(Fiscal year 2012)[43]
min. 2 years
(as of 30 Apr 2013)
max. ±15%[nb 6]
(for 2012)
max. 5.5%[nb 9]
(as of 30 Apr 2013)
 Poland 2.7% Open 3.9% 55.6% No -1.6% 4.44%
2014 ECB Report[nb 10] Reference values max. 1.7%[nb 11]
(as of 30 Apr 2014)
None open
(as of 30 Apr 2014)
max. 3.0%
(Fiscal year 2013)[45]
max. 60%
(Fiscal year 2013)[45]
min. 2 years
(as of 30 Apr 2014)
max. ±15%[nb 6]
(for 2013)
max. 6.2%[nb 11]
(as of 30 Apr 2014)
 Poland 0.6% Open 4.3% 57.0% No -0.3% 4.19%


  Criterion fulfilled
  Criterion potentially fulfilled: If the budget deficit exceeds the 3% limit, but is "close" to this value (the European Commission has deemed 3.5% to be close by in the past),[46] then the criteria can still potentially be fulfilled if either the deficits in the previous two years are significantly declining towards the 3% limit, or if the excessive deficit is the result of exceptional circumstances which are temporary in nature (i.e. one-off expenditures triggered by a significant economic downturn, or by the implementation of economic reforms that are expected to deliver a significant positive impact on the government's future fiscal budgets). However, even if such "special circumstances" are found to exist, additional criteria must also be met to comply with the fiscal budget criterion.[47][48] Additionally, if the debt-to-GDP ratio exceeds 60% but is "sufficiently diminishing and approaching the reference value at a satisfactory pace" it can be deemed to be in compliance.[49]
  Criterion not fulfilled


Notes
  1. ^ The 12-months average for the annual HICP inflation rate must be no more than 1.5% larger than the unweighted arithmetic average of the similar HICP inflation rates in the 3 EU member states with the lowest HICP inflation. If any of these 3 states have a HICP rate significantly below the similarly averaged HICP rate for the eurozone (which according to ECB practice means more than 2% below), and if this low HICP rate has been primarily caused by exceptional circumstances (i.e. severe wage cuts or a strong recession), then such a state is not included in the calculation of the reference value and is replaced by the EU state with the fourth lowest HICP rate.
  2. ^ The annual average for the yield of 10-year government bonds must be no more than 2.0% larger than the unweighted arithmetic average of the bond yields in the 3 EU member states with the lowest HICP inflation. If any of these states have bond yields which are significantly larger than the similarly averaged yield for the eurozone (which according to previous ECB reports means more than 2% above) and at the same time does not have complete funding access to financial markets (which is the case for as long as a government receives bailout funds), then such a state is not be included in the calculation of the reference value.
  3. ^ The change in the annual average exchange rate against the euro.
  4. ^ Reference values from the ECB convergence report of May 2012.[40]
  5. ^ Sweden, Ireland and Slovenia were the reference states.[40]
  6. ^ a b c The maximum allowed change in rate is ± 2.25% for Denmark.
  7. ^ Sweden and Slovenia were the reference states, with Ireland excluded as an outlier.[40]
  8. ^ Reference values from the ECB convergence report of June 2013.[42]
  9. ^ a b Sweden, Latvia and Ireland were the reference states.[42]
  10. ^ Reference values from the ECB convergence report of June 2014.[44]
  11. ^ a b Latvia, Portugal and Ireland were the reference states.[44]

See also[edit]

References[edit]

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  2. ^ Odpowiedź na interpelację w sprawie wprowadzenia unijnej waluty bez zmiany konstytucji
  3. ^ a b c "Poland president says no euro entry decision before 2015 ballots". Reuters. 22 January 2013. Retrieved 2013-02-09. 
  4. ^ a b Puhl, Jan (6 February 2013). "Core or Periphery?: Poland's Battle Over Embracing the Euro". Der Spiegel. Retrieved 2013-02-08. 
  5. ^ a b "Wg raportu GMF Polacy coraz bardziej nie lubią USA, NATO, Obamy i Rosji". Wiadomości. 12 September 2012. Retrieved 2013-02-11. 
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  15. ^ "Poland delays adoption of the Euro until 2015". MercoPress. 16 December 2009. Retrieved 22 December 2009. 
  16. ^ Bloomberg Businessweek. 2 December 2011. Official: Poland to be ready for euro in 4 years
  17. ^ "Monetary policy guidelines for 2013 (print nr.764)" (PDF). The Monetary Policy Council of the Polish National Bank (page 9) (in Polish). Sejm. 27 September 2012. Retrieved 28 October 2012. 
  18. ^ "Polish opposition calls for single currency referendum". Polskie Radio. 19 February 2013. Retrieved 2013-02-22. 
  19. ^ Lovasz, Agnes (18 February 2013). "Poland's Euro Bid Requires Revamp Not Deadline: Rostowski". Bloomberg. Retrieved 2013-02-22. 
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  28. ^ "CBOS za przyjęciem euro 32 proc. Polaków, przeciw 60 proc.". bankier.pl. 28 March 2011. Retrieved 3 April 2011. 
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  32. ^ http://ec.europa.eu/public_opinion/flash/fl_400_en.pdf
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  39. ^ "Former euro area national currencies vs. euro/ECU - annual data (average)". Eurostat. Retrieved 5 July 2014. 
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  49. ^ "Progress towards convergence - November 1995 (report prepared in accordance with article 7 of the EMI statute)" (PDF). European Monetary Institute (EMI). November 1995. Retrieved 17 March 2013.