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August 9, 2022

Central Bank Governor: Accession to Eurozone does not automatically solve economy’s problems. Premier Dancila: Romania’s joining the euro – a real country project

Accession to the Eurozone is no panacea, it doesn’t automatically solve the problems of an economy, it might even aggravate them, on Tuesday asserted the Governor of the National Bank of Romania, Mugur Isarescu, at the presentation of the substantiation report of the National Euro Changeover Plan, carried out at the Romanian Academy.

“We must all be aware that the accession to the Eurozone is no panacea, it does not solve the problems of an economy, it could even aggravate them, it is only a stage of the convergence process, and for its proper development coherence and sustainability of the economic policies are paramount,” the BNR governor warned.

He recommended a sustainable approach to attaining the real convergence of the Romanian economy instead of haste and added that the deadline for adopting the Euro remains a topic open to discussions, reminding that countries with larger economies in Eastern Europe are treating with caution and reluctance the topic of adopting the Euro.

Isarescu warned that the Euro zone countries have not improved their convergence after adopting the single currency.

“It is important to emphasise the significance of reaching a certain minimum degree of real convergence ahead of adopting the Euro, considering that unlike the European Union, the Euro zone proved not to be a convergence club. Its current members have not necessarily improved their real convergence level after adopting the Euro. We must not ignore the problematic of the regional disparities: whilst Romania’s real convergence advanced substantially the disparities among its development zones remained visible or even deepened in time. And this was the result of the various rhythms of real convergence, that have led to the appearance of certain regional competitiveness poles once certain poverty areas got chronic. A successful adoption of the Euro asks for concrete and efficient measures in the sense of alleviating this situation,” Mugur Isarescu concluded.

The Public Finance Minister Eugen Teodorovici used to say at the beginning of April that Romania has got a very good plan regarding the changeover to Euro and its target clearly remains 2024.


Premier Dancila: Romania’s joining the euro – a real country project


Romania’s joining the euro is a real country project that requires the support of the entire society to be successful, Premier Viorica Dancila said on Tuesday.

“Romania’s joining the euro is a real country project that requires the support of the entire society – academic milieu, trade unions, employers’ organizations, representatives of the civil society, political parties and the state’s fundamental institutions – to be successful. I would compare Romania’s adopting the European single currency with other projects that have decisively changed the Romanian society for the better – I am referring to our joining the North-Atlantic Alliance and the integration with the European Union. This is why we considered that this process must be thoroughly prepared with the involvement of the entire society,” Dancila said at the presentation of the Substantiation Report of the National Plan for the Adoption of the Euro, an event hosted by the Romanian Academy.

The Premier added that in order for the switch to the euro to bring benefits to the Romanians, preparing the entry to the preliminary stage, specifically to the European exchange rate mechanism is essential, as well as taking the necessary measures to increase competitiveness and ensure sustainable economic growth.

“We have generated economic growth through stimulus measures, we maintain this pace and continue to act towards reducing Romania’s development gaps compared to other EU member states. According to the governing program, we set ourselves as a target exceeding in 2021 the threshold of 70 percent of EU’s average GDP per capita at standard purchasing power. (…) Machinery and transport equipment account for about 50 percent of the country’s exports, these are products with high added value which totaled 32.1 billion euro in 2018, up 10.4 percent from the previous year. These figures are proof that Romania is on the right track and that the economic advance is sustainable. I am convinced that through economic stimulation and support of the competitive fields, through open and constant dialogue with the social partners, we can set the prerequisites in place for Romania to be able to meet by 2024 the fundamental requirements for the adoption of the euro,” the Prime Minister concluded.


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