Romanians are ready to give up on their domestic currency, the ROL, and replace it with the euro. According to the latest Eurobarometer, 76% of the population has had enough with the increasing number of zeroes that keep adding to the ROL’s tail, favouring a shift to the euro instead.
The number of those rooting for the euro has increased 7 percent since last autumn.
The ROL is associated with the highest inflation rate in Central and Eastern Europe, as Romania is the last country with two-digit inflation. Moreover, until last summer, there was only one way for the ROL, in relation with the US dollar and the euro: down. Thus, the ROL kept adding zeroes, which gained it the image of a weak, unstable currency, unable to preserve its value. Under the circumstances, no wonder Romania is a dollarised country, where hard currency remains the main refuge and benchmark for the market.
Obviously, as Romania is about to enter the European Union, the domestic currency will become the euro, which is gradually dethroning the dollar. However, Romanians just can’t wait for the accession day.
“There is simply some sort of fascination associated with prosperity. Many people must be thinking that, if they start getting paid in euros, even if they have small wages, they will live better. At any rate, the data fit the Romanian cultural pattern perfectly, as people keep on waiting for miracles,” says Doru Lionachescu, vice-president at Banc Post.
Still, the switch to the euro is not likely to occur very soon in Romania, as 2010 is the most optimistic scenario. Until then, the inflation cut to less than 10% is the top priority, as the shift to the euro inevitably prompts an inflation increase. Moreover, in the years to come, the ROL may finally get rid of some of its zeroes. Finance minister Mihai Tanasescu says this measure will have to be endorsed after next year’s elections. A postponement would certainly lead to the release of the 1,000,000 ROL bill, as the biggest Romanian banknote (500,000 ROL) can only buy 13.5 euros or 15.5 US dollars.
Only the Slovenians are in a bigger hurry to get rid of their domestic currency, as 85% favour this move. However, their currency is less than ten years old. On the contrary, the Turkish, the Estonians and the Czechs are holding on to their domestic currencies.
“There may have been, among the Romanian respondents, people wishing for a stronger, more stable domestic currency. At any rate, I believe there are also some psychological issues involved. Some feel that they will have more money if they get paid in euros,” says Dan Pascariu, president of HVB Bank.
razvan.voican@zf.ro ; oana.nuta@zf.ro