Romania’s adoption of the euro currency is at least a year or two away from what Prime Minister Viorica Dancila has announced. Instead of January 2024 as the “firm deadline” a report drafted by the body charged with preparing Romania’s accession to the euro area sets a more realistic target date: 2025-2026.
The report, which was leaked to the local press, indicates 2024 as the most optimistic date for entering the Exchange Rate Mechanism (ERM II) – namely the period when the +/-15% exchange rate stability must be defended by compulsory interventions at the same time as maintaining the accession criteria.
As reported by Romania Insider online, the scenarios envisaged by the committee are to a certain extent arbitrary: they extend well beyond the strict euro accession criteria suggesting preliminary measures such as natality-stimulating policies, the development of business incubators and fighting tax evasion.
Other recommendations are more focused, though. “The moment of entry into ERM II and the level of parity of the leu against the euro must be chosen with the utmost caution,” since the National Bank of Romania will no longer be allowed to help the real sector by letting the currency to weaken more than the 15% band set around the parity level.
