Varieties of euro adoption strategies in Visegrad countries before the pandemic crisis

Abstract

The enlargement of the euro area (EA), an unfinished process, was low on the European agenda in the period between the 2008 and the 2020 crises. The socio-economic consequences of the coronavirus pandemic and frictions in geopolitics would call for a coherent Europe, yet new and old fault-lines appeared in the EU involving the eastern periphery where sovereignty issues gained particular importance. The authors revisit the euro adoption process of the new member states, with a focus on the Visegrad Group (V4) countries, applying a two-track approach: a monetary policy analyses of EA entry as a rational cost/benefit issue and, second, a political economic survey of key stakeholders, set in the context of the dilemmas of retaining or sacrificing nominal monetary sovereignty. Even a piecemeal enlargement of the EA, involving Bulgaria, Croatia and Romania, would cause business consequences and political repercussions in the countries left out of EA. The paper concludes that further moves towards a developmental state model would preclude euro adoption and put such member state in collision course with the core Europe.

Regional inequalities within the Visegrad group over the years 2000–2018

“…In the transition process of all the four countries significant regional disparities could be seen, as in all former socialist countries in terms of production decline, unemployment, and foreign direct investment (FDI) indicators (Bod et al, 2021) . Psycharis et al (2020), Tello et al (2019, and Burger and Šlampiaková (2021) have also highlighted the role of metropolitan areas in increasing regional inequalities in Central-Eastern Europe saying that nowadays cutting-edge technologies are more knowledge-intensive than the traditional ones and they are based on highly skilled workers and aim at the exploitation of R&D networks.…”