Changes have occurred in the last year in the environment for accession to the Economic and Monetary Union (EMU) by the Visegrád countries. The new EU memberstates are all now members of the European exchange-rate mechanism (ERM–2) and could enter EMU in 2007. But there are differences in their starting points and financial-policy approaches. One of the challenges of the coming years will be to hold the low inflation rates and tight fiscal policies even under the public financial pressures exerted by the extra costs of EU accession and the modernization needs characteristic in the region. These circumstances necessitate reform of the public-finance system in all the new EU countries. The viability of the common European monetary policy in recent years has shown the Euro bringing stability to the Continent, yet the performance of the Euro has fallen short of economic development in the United States, in the real economy and in terms of nominal indicators. This sounds a warning to the Visegrád countries that in spite of the advantages of the Euro zone for the catch-up economies, there must be some structural reforms to the stable macroeconomic foundations, and it would not be a bad thing if they occurred before entry. For the positive fiscal tendencies are not a direct effect of EMU; they are attributable to the economic policies being applied. reveals, contrary to general belief, that the price transmission in this market is asymmetric.
Financed by the National Centre for Research and Development under grant No. SP/I/1/77065/10 by the strategic scientific research and experimental development program:
SYNAT - “Interdisciplinary System for Interactive Scientific and Scientific-Technical Information”.