Croatia could adopt euro in January 2023 as Commission gives the all-clear
Croatia could be the next country to join the eurozone after the Commission gave its approval on Wednesday.
If the move is endorsed by the Eurogroup and EU Council later this month, Croatia could adopt the EU's official currency as early as 1 January 2023 — six months before it celebrates its tenth anniversary as an EU member. It would thus become the euro area's twentieth member.
The endorsement from the Commission is based on its latest Convergence Report reviewing member states' preparedness to join the euro area.
Out of the seven member states under review — Denmark has an opt-out — Croatia is the only one to fulfil all criteria necessary for accession. These include compatibility of the national legislation with the provision of central bank independence, price stability (comparatively low inflation on a level similar to the euro area), fiscal stability (deficit not exceeding 3% of GDP as mandated by EU rules), exchange-rate stability and durable convergence (comparatively low long-term interest rates).
An EU official told reporters that "it is also true there was a very strong political determination from the part of the Croatian authority" to join the euro and that "this, for example, has not been the orientation taken by the other countries in the waiting room, so to speak."
The official also dismissed concerns that Croatia would not be "a safe member of the euro area" or a "repeat of Greece", arguing that since the euro crisis of 2008, the eurozone has created new institutions, including a banking union and supervisory mechanisms, to better monitor financial institutions.
"Croatia is a very small, open economy," the official stated, and "its banking system is largely owned by large banks in very large countries" which
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