News: Euro boost for Cyprus and Malta

Fri, 25 May 07

Cyprus and Malta look set to adopt the euro after their applications cleared the first major hurdle...

Their bids to join the single currency next year were backed by the European Commission and European Central Bank, reports the BBC.

They will become the 14th and 15th members of the eurozone on 1 January 2008 if EU leaders and finance ministers give their approval. Both have been members of the European Union since May 2004.

If all goes to plan, EU finance ministers will fix the euro exchange rates for the Cyprus pound and the Maltese lira during a two-day meeting on 9 and 10 July.

Voluntary dual pricing in the national currency unit and the euro is already widespread in Malta, particularly in tourist shops, analysts say. It also currently applies in Cyprus on receipts in big department stores and in tourist resorts.

Both countries making 'good progress'

The last country to adopt the single currency was Slovenia, which joined the EU at the same time as Malta and Cyprus.

The European Central Bank said both would-be eurozone members were making good progress in meeting the necessary economic performance criteria, as set out in the Maastricht Treaty.

These cover government debt, currency stability and interest rates.

However, the ECB added that further efforts were still needed, particularly in curbing their high debt ratios.

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