Upon entry into the European Union, countries become members of the Economic and Monetary Union (EMU), with a derogation from adopting the euro as their currency (that is, each country joining the EU commits to replace its national currency with the euro, but can choose when to request permission to do so). For most of these countries, adopting the euro will entail major economic change. This paper examines likely economic developments and policy challenges for the five former transition countries in central Europe - the Czech Republic, Hungary, Poland, the Slovak Republic, and Slovenia - that joined the European Union in May 2004 and operate under independent monetary policies but have not yet achieved policy convergence with the rest of the euro area.
Eight central and eastern European countries - the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovak Republic, and Slovenia - officially joined the European Union (EU) in May 2004. This auspicious milestone marked the beginning of the next major step for these countries in their move toward full integration with the EU-adoption of the euro. Seeking to consider the opportunities and challenges of euro adoption, the papers in this volume - by a noted group of country officials, academics, representatives of international institutions, and market participants-offer insight on the various dimensions of euro adoption in these eight new EU members - how they should prepare, whether an early move is optimal, and what pitfalls may occur along the way.
