A successful economic convergence story
Overview:
A late starter in the EU/EMU accession process, Slovakia has become a leading example of a successful economic convergence story. The implementation of a comprehensive structural economic reform program and sound macroeconomic management has allowed Slovakia to join the EU and become only the second of the transition economies to enter the Euro at the beginning of this year. While euro adoption may ultimately have costs as well as benefits it has certainly helped to protect Slovakia from a period of high exchange rate volatility and financial stress being endured by most of its neighbours. The reformist government that played a key role in this reform process has since lost power. However, the Euro adoption process has proved a strong external policy anchor for the once populist Smer now in office.