|
The euro-entry strategy is generally sound
The strategy on euro entry has much to commend it. The risks of Exchange-Rate Mechanism II (ERM II) membership are to be minimised by only entering when conditions look set for the fulfilment of the Maastricht criteria. Also, commitment to euro entry a long way in advance is being avoided through annual assessment and decision on whether conditions are right to join ERM II. Credibility of the strategy has been heightened by a process of dialogue and explicit agreement between the Government and the Central Bank.
Timing issues in the fulfilment of Maastricht criteria
Source: Komárek, Čech and Horváth (2003).
Communication of the inflation target needs to pay close attention to the interpretation of the price stability criterion
The choice of a 3 per cent inflation target for the run-up to euro entry is justifiable on medium-term grounds. However there may be some difficulty communicating the consistency of this target with the Maastricht criterion for price stability. The Czech authorities should therefore pay close attention to how the Maastricht criteria are interpreted and applied by the European Commission and the European Central Bank and adjust their communication strategy accordingly.
Return to the OECD Economic Survey - Czech Republic 2004 homepage
A printer-friendly Policy Brief (in PDF format) may also be downloaded. The Policy Brief contains the executive summary and the OECD assessment and recommendations, but does not necessarily include all of the charts available from the above pages.
The Czech language version of the Policy Brief is also available
-------------------------------------------------------
The complete edition of the OECD Economic Survey for the Czech Republic is available from:
-
SourceOECD for subscribing institutions and many libraries
-
-
Olisnet, under "Publication Locator", for government officials with accounts ( subscribe)
-
|
