Waiting for the euro

At a conference entitled "The Euro and the Polish Economy" organized by the department of economics at the University of Warsaw, economists discussed the pros and cons of Poland joining the eurozone. The majority of speakers agreed the country could benefit significantly from the common currency and should try to meet the necessery criteria as quickly as possible.

"The biggest advantage of Poland adopting the euro would be better access to foreign savings, which would reduce the risk of large-scale macroeconomic destabilization to zero. This will increase by far the level of domestic investment financing," said Professor Stanisław Gomułka from the London School of Economics.

Other advantages mentioned by experts include lower transaction costs, reduced thanks to the lack of fluctuations in exchange rates, as well as lower real interest rates and the effects of scale on the level of 0.1-0.2 percent of GDP annually.

Poland is the only post-communist EU member which has not set a euro-entry target date. The ruling Law and Justice (PiS) partly claims economic growth and fighting unemployment are higher on its list of priorities and entering the eurozone should not be done in haste.

However, during the debate on the 2006 budget, the new Finance Minister, Zyta Gilowska, said: "Without the euro, Poland is defenseless in the face of various economic shocks, which the gobalized world economy is undergoing." She later added that the country must work hard to prepare for the adoption of a common currency.