Vujčić: Next year we will know the exact date of the transition to the euro

The Governor of the Croatian National Bank Boris Vujčić stated at the conference "What does the introduction of the euro bring to small and medium-sized enterprises?" that the exact date of the transition from the kuna to the euro will only be known next year, and that a strong campaign will be conducted next year to ensure the public is accurately informed about everything that this transition entails. 

At the conference organized by the daily newspaper 24 sata, the Governor of the Croatian National Bank emphasized that Croatia has a target date for the transition to the euro, but that the exact date will only be known next year.

 – If it will be January 1, 2023, we have only 14 months left. To some, this may seem like a lot, but for the process itself, it is relatively little time – said Vujčić, adding that next year a broader campaign will begin to inform citizens and entrepreneurs about the characteristics of the transition from the kuna to the euro.

There will be, as he said, a law that will precisely determine how the transfer from the kuna to the euro will occur, and the fundamental principle will be consumer protection so that during the transition itself, consumers cannot end up in a worse position than they were before, both in terms of deposit conversion and loan conversion. All of this applies to businesses as well.

– The experiences of all countries that have entered the eurozone so far show that wage growth has been higher than price growth, and the standard of living has increased, which is why support in countries that have introduced the euro so far is very high –  emphasized Vujčić. In other transitional countries that have introduced the euro, support is around 80 percent, which according to Vujčić proves that the fear of a decline in standards is unfounded.

– And we will repeat that message in the campaign we will conduct next year –  noted the governor. He also stated that the mechanism of dual price display has proven to be very useful in other countries. Dual price display will not only affect prices in stores but also wages, all types of fees, services, etc., so that people can get used to the new prices. 

Businesses will be offered an ethical code to which they can adhere and which obliges them to act fairly in the transition from the kuna to the euro, and those who agree to this will receive a sticker. On the other hand, there will also be a blacklist where consumers can report those who do not comply with the prescribed method of transition. 

Regarding the logistical work, he emphasized that the exchange of money has been in preparation for a year and a half and that preparations are already underway.

– It will be quite challenging on one hand to withdraw existing coins and banknotes from circulation – 1.1 billion coins and 500 million banknotes – it will be quite challenging to store these coins for three years. Preparations have progressed quite far, and everything is being organized with the Croatian Army because we do not have the space to carry this out logistically. Likewise, we must have a certain amount of euro banknotes and coins that we will distribute to the economy and people –  noted Vujčić. 

There will also be so-called starter kits through which people will be able to receive different denominations of euros that will be distributed through the post, Fina, and banks, and there will also be a pre-supply of euros to businesses, which will occur before the actual conversion. Otherwise, two weeks after the introduction of the euro, payments can be made in both kunas and euros.

Finance Minister Zdravko Marić also emphasized that, according to current projections, we will be able to introduce the euro no earlier than January 1, 2023. 

He added that some countries, such as Lithuania, have been in the so-called waiting room for the introduction of the euro for more than ten years, while Slovenia has been there for just over 900 days. Dual price display, he noted, will be five months before the introduction and one year later. The exchange of kunas for euros will be conducted by banks for a certain period, while the Croatian National Bank will do so for much longer. According to Marić, the law on the euro should be adopted in the spring of next year. 

The President of the Croatian Chamber of Trades and Crafts, Dragutin Ranogajec, expects problems in the adjustment phase, during the mentioned 14 days when payments will be made in both currencies. He is primarily concerned about the adjustment of all programs, as changes must also be made in business records, and there will also be problems with fiscalization. 

 – We are asking what will happen if someone fiscalizes an invoice on the 15th day and the customer only has kunas; these are problems we already see –  emphasized Ranogajec, adding that education will be the most important, and for that, he expects support from the state.

He also added that the transition to the euro is inevitable and that it will bring much more benefits than harm, but that what happened with the German mark and the euro should not happen, where what cost one mark was rounded to one euro.