Eastern Europe increasingly reluctant to enter Eurozone

Eastern European nations that have not yet joined Europe’s single currency are reluctant to make the move, fearing the uncertainty in the bloc and a growing divide in the debt crisis debate.

The latest country to put a brake on its plans to enter the Eurozone is Bulgaria.

The country’s prime minister Boyko Borisov and finance minister Simeon Djankov have said deteriorating economic conditions and rising uncertainty over the prospects for the bloc are the key reasons for postponing the decision.

Bulgarians have also not been overly supportive of joining the Euro area at such a volatile time, as Bulgaria faces its third years of austerity measures.

In an interview to the Wall Street Journal, Djankov said “right now [he doesn’t] see any benefits of entering the euro zone, only costs.”

Bulgaria’s decision to put off joining comes on the back of similar decisions by other Eastern European states.

Last week saw Lithuania make a similar announcement. Its prime mister Andrius Kubilius said the country would join the common currency only when “Europe is ready”.

Latvia’s enthusiasm has also cooled. Its prime minister Valdis Dombrovskis said the government will make a decision on joining the euro next spring. Previously Latvia planned to become a member by 2014.

Poland is the only one that bucks this trend. Yesterday, its foreign minister Radoslaw Sikorski said his nation still wishes to join the euro.

In an interview with Germany’s Frankfurter Allgemeine newspaper, Sikorski said: “We want to join this zone. We are not like some countries that have negotiated an ‘opt-out’ for themselves.

“We have committed ourselves to introduce the euro – we are contractually obliged to do this – and Poland’s populous has backed this in a referendum.”

Despite the positive outlook, though, he added that countries using the euro must first solve their significant currency problems. Only then will Poland be ready to join them, he said.

He also insists the fiscal pact structure must “take notice of [Poland’s] voice where the architecture of the Eurozone is involved” and he is convinced “everything should be constructed in such a way that new members are encouraged to join”.

In the meantime, European policy makers are still no closer to a decision on how to handle the debt crisis and the divide between Germany’s supporters and opponents continues to grow.


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