MEPs have approved Slovakia's bid to adopt the euro on 1 January 2009. At the same time, they stressed that Slovakia should make further efforts to keep its rate of inflation down and continue structural reforms to its economy. In a report drawn up by David Casa (EPP-ED, MT), Parliament agrees with the Commission that Slovakia has met the criteria to join the euro.
Ongoing efforts urged on inflation and structural reform
MEPs note that the European Central Bank has identified risks concerning the sustainability of the low inflation rate achieved by Slovakia, and urges further fiscal consolidation, with a balanced budget in the medium-term, and for the social partners to keep wage growth in line with productivity growth in order to maintain a low inflation environment. They also call for the structural reforms to the labour, services and product markets to continue and say the government of Slovakia should ensure competition, notably in sensitive sectors such as energy.
Informing the public
The report also calls for a public information campaign to explain the benefits of the single currency ahead of the conversion, and for the necessary steps to be taken to minimise price increases during the changeover period. An observatory should be set up to monitor the prices of a selection of basic goods so as to fight false perceptions about price increases.
Changes after the assessment
MEPs stress that all relevant measures taken by a Member State applying for membership of the euro area, after the publication of the convergence reports of the Commission and the ECB, should be taken into account by the Council on the basis of the relevant Parliament resolution and integrated into the monitoring process.
The European Council is expected to take a political decision on Slovakia's euro membership at its 19-20 June summit, with the formal legislation being put to the vote at the following meeting of EU finance ministers. Parliament's role in decisions on euro area enlargement is consultative.