The enthusiasm for the euro is cooling among the EU?s newest members in eastern Europe, as Latvia?s prime minister warned that his citizens are turning against the single currency.Why any country would consider joining the eurozone now is beyond me. Yet, in spite of the fact that 56% of Polish citizens are against the idea, the Polish government intends to ram this mess down their throats anyway.
Valdis Dombrovskis, who led one of Europe?s toughest austerity programmes in part to keep Latvia?s euro membership hopes alive, says he faces a struggle to get the Baltic republic into the single currency by the 2014 target.
?Five years ago before the eurozone crisis everyone wanted to enter the euro, but we weren?t economically ready. Now that we are ready to enter, many have become sceptical,? said the centre-right leader.
Bulgaria, which like the Baltic states has pegged its currency to the euro for a decade and is one of only three EU countries that currently meet the Maastricht entry criteria in full, has recently made clear it has no short-term plans to move towards membership.
Boyko Borisov, prime minister, told the FT recently his government had no plans to join until the eurozone crisis was over. The EU?s poorest country should not have to help fund bailouts of richer states, he said.
?I think for the time being it would be unfair to join the eurozone and to support countries where pensions are higher than the pensions of our people,? he said. ?How can we tell Bulgarians, we will take from your pensions in order to pay pensioners in Greece, Spain or Italy??
In Poland, public opposition to euro adoption has edged up slightly as the eurozone crisis has deepened, with a new opinion poll sponsored by the finance ministry finding 56 per cent of Poles were against joining, up 3 percentage points from a last year.
Petr Necas, the [Czech] premier, has said that his country will not join during this government, whose mandate expires in 2014, and not until 2020 at the earliest, subject to approval by a referendum.
Vaclav Klaus, the eurosceptic Czech president, has called the European Stability Mechanism ?a monstrous and outrageous thing? and said this month he would not sign the EU treaty amendment creating the eurozone rescue fund.
The Czech president has the right idea, that the ESM is a "monstrous and outrageous thing". Moreover, nannycrat agreements like the ESM are bound to get worse as the Spanish, Italian, and French economies implode.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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