Saturday, December 12, 2020

No Euro Yet

When I was deciding to make the move to Czechland many years ago, it looked like the country would change its currency from the Koruna to the Euro around 2015.  This was a selling point for me because I thought it would be a once in a lifetime experience to go through a currency switch.  Well I've been here 11,5 years and there's no outlook in sight for ever actually making the move.

When Czech Republic joined the EU in 2004 it became legally obligated to adopt the Euro once it fulfilled the necessary requirements for joining the Eurozone.  There's a lot to be gained by adopting the Euro.  Three of the four countries bordering Czechland all use the Euro.  More than 57% of the country's foreign trade is with countries using the Euro, almost one-third just with Germany.  If Czechia was on the Euro then it would be easier for businesses to conduct trade because no one would have to factor in foreign exchange rates.  

Czechs are reluctant to give up the Czech Crown because they know that while it would be better for the country overall, it means that things will become more expensive as prices get rounded up but salaries won't.  The country could join the Eurozone whenever it wanted to but every time it gets close to meeting all of the requirements it seems to purposefully flub things up so that can just keep kicking the can down the road.

The government has just said that due to economic conditions resulting from COVID-19 and this year's budget deficit that the country will not set a date yet to adopt the Euro because the prerequisites for joining will not be met.

There are 19 countries on the Euro.  When it was first introduced Denmark and the UK opted out.  Now that the UK has left the EU after Brexit, only Denmark doesn't have to make the switch.  Besides Czechland, Bulgaria, Croatia, Hungary, Poland, Romania, and Sweden all still need to give up their national currencies for the Euro.

Here's a short video I found on YouTube about Slovakia, from 2008, right before it was to adopt the Euro. in 2009.  It could be about Czechia today.     

©DW News

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