The euro was introduced on 1 January 1999 in 11 Member States and on 1 January 2001 in Greece. Following the enlargement of the European Union (EU) with ten new Member States on 1 May 2004, in 2006 13 Member States were not full participants in Economic and Monetary Union (EMU).
In May 2006 the European Central Bank (ECB) and the European Commission prepared Convergence Reports on two of these Member States, namely Lithuania and Slovenia, following their requests for an examination. Taking into account these reports and upon a proposal from the Commission, the EU Council in the composition of the Ministers of Economy and Finance (the ECOFIN Council) decided to abrogate Slovenia’s derogation on 11 July 2006, allowing it to adopt the euro on 1 January 2007. At the same time, Lithuania’s status as a country with a derogation remains unchanged.
As Lithuania was already examined in May 2006, it is not included in this report. In addition, two other Member States that are not full participants in EMU, namely Denmark and the United Kingdom, have a special status. At an earlier stage, these countries gave notification that they would not participate in Stage Three of EMU. As a consequence, Convergence Reports for these two Member States only have to be provided if they so request. Since no such request has been made, this Convergence Report excludes these two countries. It therefore examines nine countries: the Czech Republic, Estonia, Cyprus, Latvia, Hungary, Malta, Poland, Slovakia and Sweden. These countries have last been examined in the 2004 Convergence Report, i.e. they are examined in the context of the regular two-year cycle.
This Introduction and Executive Summary continues with an overview of the key aspects and results of the examination of economic and legal convergence. A more detailed analysis follows in Chapters 1 and 2. Chapter 1 examines the state of economic convergence in each of the nine Member States under review. Chapter 2 examines the compatibility between each of these Member States’ national legislation, including the statutes of its NCB, and Articles 108 and 109 of the Treaty and the Statute of the ESCB. [...]
