Wednesday

26th Apr 2017

Poland adopts step-by-step euro entry plan

  • Poland - could become the 17th member of the eurozone (Photo: EUobserver)

The Polish government has adopted a detailed timetable designed to replace the Polish zloty with the euro on 1 January 2012, but question marks remain over a potential referendum on the move.

The four-stage plan will kick off in November when Warsaw appoints a top official to co-ordinate technical and legal preparations. The first stage will culminate in a change to the Polish constitution and formal agreement on Polish entry with the European Commission and EU states in early 2009, PAP reports.

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The second phase is to start in June 2009, when Poland pegs zloty fluctuation to the euro in the so-called ERM2 mechanism. The rest of 2009 and 2010 will be spent deciding the design of Polish euro coins and creating a code of ethics to stop businesses hiking prices after the change-over. Eurozone finance ministers will by mid-2011 decide on the final zloty-euro exchange rate.

The third step - in the second half of 2011 - will focus on practical preparations: minting coins, delivering banknotes to shops and banks, tweaking cashpoint machines and IT systems. The year will end with a media campaign and dual display of both zloty and euro prices in Polish shops.

Final adoption, at the start of 2012, will see both currencies in circulation for an as yet undecided spell before the zloty ceases to become legal tender.

It remains unclear when or if a referendum on euro-adoption will be slotted into the timetable and whether it will ask "if" Poland should enter the euro or "when." A negative answer to an "if" referendum would put Poland at odds with its legal commitment to enter the single currency under its 2004 accession treaty.

Polish President Lech Kaczynski on Tuesday (28 October) night said the currency switch could cause inflation and damage small businesses.

But the president took a softer line than his twin brother and leader of the eurosceptic opposition Law and Justice party, Jaroslaw Kaczynski, who opposes the 2012 date and has called for a referendum on the switch.

"For me it's a matter for discussion. We will reflect deeply on the issue," Mr Lech Kaczynski said, Polish daily Gazeta Wyborcza reports, with obstruction by the president or Law and Justice to potentially delay the four steps in the outline.

Poland would become the 17th member of the eurozone in 2012 as things stand, although the three Baltic states - Latvia, Lithuania and Estonia - are already in ERM2 and are likely to make it first.

Slovenia, Malta and Cyprus were the first new EU states to join, with Slovakia to enter in 2009.

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