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Slovakia meets just one criterion for euro adoption

SlOVAKIA, which hopes to join the European Monetary Union by 2009, has only met one of conditions for adopting the common European currency so far - the convergence of long-term interest rates, said the European Commission and the European Central Bank in its latest report.

The remaining conditions, such as price stability, budget deficit, exchange rate stability and implementation of the required legislation have yet to be fulfilled, TASR news agency wrote.

"The report concludes that none of the monitored countries meets all criteria for adopting euro," said EU Commissioner for Monetary and Economy Issues Joaquin Almunia

Lithuania has done the best having met three of the required criteria so far, while Czech Republic, Cyprus, Latvia, Slovenia, Estonia, and Lithuania each met two conditions. Malta met one criterion jus like Slovakia, while Poland and Hungary met none of the requirements as yet.

The report stated that Slovakia's central bank (NBS) integration into a system of European central banks is lagging behind because the country's legislation is not yet fully in compliance with the EU's requirements on the NBS independence.

The country fell short of price stability as its annual inflation was an average of 8.4 percent at the end of August, which is 1.5 percent above the reference figure of the three EU best-performing countries (2.4 percent) for a given month.

Slovakia's budget deficit was 3.7 percent of GDP in 2003 ecxeeding the 3 percent level set by the Maastricht criteria.

In convergence of interest rates, Slovakia's rates averaged 5.1 percent in August, below the EU's 6.4 percent.

Finance Minister Ivan Mikloš said taht the nation's economy was on track to meeting the Maastricht criteria by 2007 on a sustainable basis, which would mean that the country could adopt euro in 2009.

Compiled by Martina Jurinová from press reports
The Slovak Spectator cannot vouch for the accuracy of the information presented in its Flash News postings.

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