UniCredit: Romania will not switch to the euro before 2019

Romania is to enter the euro zone in 2019 at the earliest, four years later than the official target and behind some countries such as Bulgaria, the Czech Republic, Poland and Hungary. The country will enter the ERM II in 2017, shows a report by Italy’s UniCredit group.
The National Bank has maintained its euro adoption target for January 1, 2015, but governor Mugur Is`rescu has repeatedly said the adoption calendar needs to be reviewed amid economic trends.
“In setting the euro area integration date, we also took into consideration the following factors. Firstly, though this is not stipulated among the Maastricht criteria, we believe states will have to keep their budgetary gap below the 3% of GDP limit for at least three years before entering the ERM II,” write UniCredit analysts. According to the adjustment calendar negotiated with the EC and IMF, Romania should bring its budgetary gap below this limit in 2012.
“Secondly, besides the Maastricht criteria, we believe any state will not be able to enter the ERM before having entirely repaid its IMF or EC loans,” UniCredit analysts also say. Romania should complete the repayment in 2016.