Slovakia closer to the euro

The Economic and Monetary Affairs Committee of the European Parliament has approved a recommendation for Slovakia to be admitted into the eurozone as from January 1.

The favourable recommendation, adopted by 33 votes in favour, four against and eight abstentions, was drawn up by Nationalist MEP David Casa who earlier this year was appointed rapporteur.

While approving the country's introduction of the euro, the committee also stressed the need for Slovakia to continue to make further efforts to keep its rate of inflation down and proceed with structural reforms to its economy.

Mr Casa's report agreed with the European Commission that Slovakia has met the criteria to join the euro.

However, MEPs noted that the European Central Bank had identified risks concerning the sustainability of the low inflation rate achieved by Slovakia and urged further fiscal consolidation, with a balanced budget in the medium-term, and for the social partners to keep wage growth in line with productivity growth in order to maintain a low inflation environment.

MEPs also called for the structural reforms to the labour, services and product markets to continue and said that the government of Slovakia should ensure competition, notably in sensitive sectors such as energy.

Mr Casa's report also called for a public information campaign to explain the benefits of the single currency ahead of the conversion and for the necessary steps to be taken to minimise price increases during the changeover period. An observatory should be set up to monitor the prices of a selection of basic goods so as to fight false perceptions about price increases.

Parliament will vote on the report at the plenary session in Strasbourg later this month.

The European Council is expected to make a political decision on Slovakia's euro membership at its June 19-20 summit, with the formal legislation being put to the vote at the following meeting of EU finance ministers in July.

The European Parliament's role in decisions on euro area enlargement is consultative.