WB: You can adopt the euro as early as 2012

Romania is in a position to adopt the euro as early as 2012, however, the experience of other EU members suggests the process must not be rushed, as real convergence needs to be achieved, stated Catalin Pauna, an economist with the World Bank’s office in Bucharest. At present, Romania plans to adopt the euro in 2014, in line with the convergence programme put in place earlier this year. “Adopting the euro even as early as 2012 is conceivable. However, we must observe the lessons learnt from other states, which shows we should not hurry,” said Pauna. He explained that Romania must strive and amend the problems related to public administration, justice and public resource allocation. This is the second authoritative signal on the possibility of euro adoption being sped up, after the NBR governor Mugur Isarescu (photo) recently stated that Romania may be en route to a single European currency earlier than 2014, if things go well. “I believe Eastern European countries must consider both the benefits and the disadvantages generated by adoption of the euro, and must not hurry if they don’t have similar structures to those of the other partners,” added Catalin Pauna. At the same time, Isarescu specified the International Monetary Fund had a more relaxed position than the NBR on domestic currency growth, while the IMF’s inflation estimate is more pessimistic than that of the NBR. The IMF has even gone so far as to recommend that the NBR raise the monetary policy interest rate, in its latest report on the Romanian economy.