National bank governor says earliest date for adoption of European currency is 2020

For the first time ever, the value of Czech crowns in circulation has exceeded 500 billion crowns. The figure was reached on Friday, the Czech National Bank revealed. The amount translates into more than two billion individual banknotes and coins. At some point though the country is slated to join the Eurozone, giving up the crown for the euro – the only question is when.

Photo: Štěpánka Budková

By all accounts, the crown will remain in circulation for some time to come. Following new expert analysis to be assessed by the government, it is clear the earliest the country could hope to join the euro zone is in around five years’ time. The bank’s governor, Miroslav Singer, said this just recently:

“This government does not have euro adoption in its programme, so this will be up to the next one to decide, at the earliest by 2020.”

The governor’s assessment is in line with the wait-and-see government stand and Finance Minister Andrej Babiš told Czech TV there was no reason, given the recent Greek debt crisis, to rush in.

“There is certainly no reason to join the eurozone today given how it was at a loss in dealing with the Greek crisis.”

But some opposition politicians on both sides of the political spectrum would prefer the euro adoption decision be delayed indefinitely. Both the right wing opposition Civic Democrats and the Communists would prefer euro adoption being decided by the Czech public in a national referendum, not widely seen as a likely option.

Meanwhile others like former finance minister Miroslav Kalousek say there is no reason to set a firm date on euro adoption now, but that it would be a mistake to “give up” on the goal entirely.

Polls in the Czech Republic suggest the majority of the public, some 61 percent, is currently against adopting the euro, unlike neighbouring Slovakia, where two-thirds of the population apparently have no regrets that they already dropped their own crown for the euro. The fellow Visegrad Four country adopted the European currency back in 2009 in a short-lived window of opportunity which allowed them to take the decisive step.

In reality, the Czech Republic already meets many of the euro membership criteria but currently lacks the political will. If and when the mood shifts, the Czech Republic will still have to enter the so-called euro waiting room. It would have to set a central conversion rate for the crown with limit room for it to move within a narrow band. So the most popular thousand crown note and one crown piece look likely to be in pockets for some time to come.