Euro adoption is likely to be pushed back at least two years from the current formal deadline of January 1, 2015, but the possibility of Romania becoming a member of the euro zone as late as after 2020 cannot be ruled out, either, with the delayed reforms that should prepare the real economy for this change as the main cause, analysts say.
"Given the current development level and the structural reforms the economy should still undergo, a credible target may be after 2020. Otherwise, we may still have talks of postponing it as we draw near the new target (...)," says Nicolaie Chideşciuc, a chief-economist with ING.
NBR governor Mugur Isărescu has repeatedly warned that shifting to the euro before the economy has adjusted and Romanian firms become competitive abroad is not desirable.
Romania currently does not meet any of the four major convergence criteria, according to a report the European Commission published in May 2010, with tax stability as the main threat.
However, before coming up with a credible target, authorities need to have a firm integration calendar and even build up a budgetary policy that should take into account euro adoption and not the temporary boosting of the economy, analysts also say.
Euro adoption is likely to be pushed back at least two years from the current formal deadline of January 1, 2015, but the possibility of Romania becoming a member of the euro zone as late as after 2020 cannot be ruled out, either, with the delayed reforms that should prepare the real economy for this change as the main cause, analysts say.
"Given the current development level and the structural reforms the economy should still undergo, a credible target may be after 2020. Otherwise, we may still have talks of postponing it as we draw near the new target (...)," says Nicolaie Chideşciuc, a chief-economist with ING. @N
