Marić: The adoption of the euro law is expected in April next year

The Deputy Prime Minister and Minister of Finance Zdravko Marić stated that the euro law is in the drafting phase, with a draft expected to be published in mid-January, while its adoption is anticipated in April next year.

In addition to this law, it will be necessary to amend 46 legal and more than 70 subordinate acts before the actual introduction of the euro, Marić said at the conference “Croatia as part of the Eurozone,” which is being held in Rovinj organized by Večernji list and Istria County.

The government has set January 1, 2023, as the date when Croatia should be ready to enter the Eurozone, and the formal announcement of Croatia’s entry into the Eurozone is expected in mid-next year.

– From that moment, Croatia practically enters the final phase, and all this work we are doing must be accelerated because there is a lot of work ahead of us – said Marić, reminding that it will be necessary to withdraw almost one billion and one hundred million kuna coins and 500 million kuna banknotes and to carry out pre-supply of banks, post offices, Fina, and entrepreneurs with euro banknotes and coins.

A significant adjustment in the financial sector is ahead, and as everything has one common denominator, that is “information and consumer protection as an integral principle of the entire process we are conducting.”

According to him, starting from August next year, the obligation of dual price display will be regulated through the euro law, which is one way to alleviate inflationary pressures.

– On January 1, 2023, we will overnight switch to the euro, and for another two weeks, there will be dual circulation, citizens will be able to pay in kuna, and after that only in euros. The period of dual price display will last at least one year – emphasized Minister Marić.

He reiterated that there should be an open discussion on the important topic of entering the Eurozone.

– Both Prime Minister Plenković and Governor Vujčić and I are lobbying with European colleagues for Croatia to be the next member of the European monetary zone. We all know that we have a very highly euroized society and economy. Even the HNB is deeply integrated into the flows of the European Central Bank system, so it is natural to move towards what is written in the accession agreement with the EU. Just as the path to EU membership was long, many steps need to be taken to enter the Eurozone, but above all because it is good for our economy – said Minister Marić.

HNB Governor Boris Vujčić stated that Croatia is a country that will benefit the most from entering the Eurozone.

– This will be the case because Croatia has the highest currency risk, and it is highest due to the high degree of euroization. Most of the debts of Croatian companies are either in euros or indexed to it. This means that if there is a depreciation of the kuna against the euro by ten percent, the debt of the corporate sector will increase by 20 billion kuna. If we look at all sectors, the debt increases by 52 billion kuna. Therefore, the risk is high, and if that were to happen, we would be in recession. And that is why the HNB has never allowed significant fluctuations in the exchange rate. So you must keep the exchange rate fixed, and you are practically already in the Eurozone – said Governor Vujčić.

As heard at the opening of the conference, although giving up the national currency brings certain economic risks, switching to the euro opens up a range of economic benefits.

Whether Croatia will use the euro for economic progress or whether giving up monetary sovereignty will be a burden around its neck will depend primarily on the structure and strength of the domestic economy. A new European financial period and the beginning of the use of non-repayable funds based on the National Recovery and Resilience Plan lie ahead for Croatia, it was stated at the conference.