Flash Eurobarometer Commission Introduction of the euro in the New Member States Summary Fieldwork: March 31 April 5 2006 Publication: June 2006 Flash Eurobarometer 183 The Gallup Organization Hungary This survey was requested by Directorate General Economic and Financial Affairs and coordinated by Directorate General Communication This document does not represent the point of view of the Commission. The interpretations and opinions contained in it are solely those of the authors.
Flash EB Series #183 Introduction of the euro in the new Member States Wave 3 Conducted by The /Europe upon the request of the Commission, Directorate-General Economic and Financial Affairs Survey organised and managed by the Eurobarometer Team of Directorate-General Communication This document does not reflect the views of the Commission. Any interpretations or opinions expressed in this report are those of the authors alone. THE GALLUP ORGANIZATION
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Introduction Despite a widespread belief to the contrary among their citizens, the New Member States of the Union have the obligation to adopt the common currency, the euro, once they have fulfilled the economic stability criteria defined in the Maastricht Treaty. There is no common strategy or fixed timetable with regard to the introduction of the euro in each of the newly acceded member states. At present, seven New Member States have joined the Exchange Rate Mechanism II (Estonia, Lithuania, Latvia, Slovakia, Slovenia, Cyprus and Malta), while the three largest countries - Poland, the Czech Republic and Hungary - still remain outside of the common exchange rate mechanism (a country must have been a member of the ERM II for a minimum of two years before adopting the euro). The New Member States are committed to adopt the euro as part of their accession to the EU. At present they are working to meet the economic entry criteria on government deficit and debt, inflation, interest rates and exchange rate stability. They are all expected to join the euro area in due time. There has been a lot of discussion in Member States and in bodies about whether or not adherence to the nominal convergence criteria laid out in the Maastricht Treaty thus, a too early adoption of the euro is useful for the New Member States. Some national governments see a conflict between the Maastricht criteria and what they call real convergence needs (e.g., catching up with the per capita national income, wages, public services). Internal debates in some countries have even led to speculation about possible referenda occurring with regard to joining the euro-zone, which would effectively be a second referendum on membership itself. Concerning the introduction of the euro in the new EU countries, the Commission is keeping track of general opinion, of levels of knowledge and information and familiarity with the single currency of citizens of the New Member States. The main themes in the report are the following: levels of knowledge and experience of the euro among citizens of the New Member States feelings as regards being informed - and the most favoured channels of information perceptions of the single currency expectations and fears concerning the adoptation of the euro This study is the third one, following on from earlier Eurobarometer surveys undertaken in 2004 and 2005. The content of the questionnaires is consistent with the previous waves, though the new interviewing mode (the current survey was predominantly done over the telephone) required certain modifications in actual questions wordings. The order of the questions changed as, which have had some effects on the responses we received (earlier studies started with the attitude questions, while the current one had experience and knowledge up front.) Of course, where possible, we will make a comparison of current results with those measured for 2005 and 2004. This report sums up the most important attitudes regarding the euro in New Member States, and highlights the most recent dynamics of opinions in each of the countries that are to adopt the euro in the future. The survey s fieldwork was carried out between 31 st of March and the 5 th of April 2006. Over 10,000 randomly selected citizens aged 15 years and above were interviewed in the ten new EU Member States. Interviews were predominantly done via landline telephone. Due to the relatively low fixed telephone coverage in the Czech Republic, Estonia, Latvia, Lithuania, Hungary, Poland and Slovakia, we sampled and interviewed 300 persons face to face as. To correct for sampling disparities, a page 4
post-stratification weighting of the results was implemented, based on important socio-demographic variables. Summary Report, page 5
Familiarity with the euro Respondents in the New Member States of the EU were relatively familiar with the common currency, yet in most countries the level of information seemed to have reached a plateau in 2005. Four out of five citizens in the area have seen euro banknotes - while three quarters report the same about euro coins. Less than half of persons have actually used the euro already. Generally, banknotes are more known and are more widely used than coins in the New Member States. Seen and used euro banknotes (%) SI CZ CY PL 10 EE LV SK LT HU MT SEEN 45 45 USED 62 67 69 71 74 77 77 76 80 83 80 83 82 95 Q1-Q2. Have you already seen euro banknotes? Have you already used euro banknotes? Seen and used euro coins (%) SEEN USED SI CY CZ PL 10 EE HU SK MT LV LT 41 41 75 79 67 78 58 77 75 73 70 69 66 63 61 90 Q1-Q2. Have you already seen euro banknotes? Have you already used euro banknotes? Slovenians are most familiar with the common currency. Since March 2006, a dual display system has been in place, and the country has its eye on a switchover to the euro in less than one year. Traditionally, Slovenians have been the most active users and supporters of the euro amongst accession countries. Czechs, Cypriots and Poles are also very likely to have seen both euro coins and notes. Lithuanians and the Maltese, on the other hand, are least likely to have seen the common page 6
currency, although the majority even in these countries have come across with both the notes and coins. While familiarity with the single currency is quite widespread in the region (with a relatively narrow gap between the most and the least familiar countries), there are disparities with regard to the extent to which citizens make use of the euro in each New Member State. The usage of both euro coins and banknotes is the most common in Slovenia, Cyprus and the Czech Republic; while in most other countries the majority of citizens have not yet used the common currency. Familiarity with the euro BANKNOTES COINS % seen 2006 % seen 2005 % seen 2004 % seen 2006 % seen 2005 % seen 2004 10 80 79 73 75 71 66 CZ 83 75 69 78 70 61 EE 77 82 78 73 72 64 LT 74 75 67 61 63 56 LV 77 75 72 63 59 52 CY 83 89 85 79 87 82 HU 71 83 79 70 75 71 MT 67 71 70 66 68 68 PL 82 80 72 77 70 67 SK 76 71 70 69 66 62 SI 95 95 95 90 91 87 As the table above shows, there has been little change concerning the extent to which people have become familiar with the euro in the zone. Current familiarity with notes (80%) is only one percentage point up from September 2005, while knowledge of the euro coin has increased by four percentage points 1. The only country where a dynamically increasing degree of familiarity with the euro can be observed is the Czech Republic (+8 percentage points for coins and notes alike). In a number of other countries we are able to see a moderate increase in familiarity: Slovakia (+5), Latvia and Poland (both +2). In several New Member States, though, quite notable drops were found when compared to 2005 (Estonia -5, Cyprus -6, Hungary -4, Malta -4) Such differences could be attributed to a change in methodology and the order of questions since 2005. As to the design of the common currency, respondents remain puzzled. Only a minority in each New Member State is able to correctly identify that banknotes are entirely the same throughout the eurozone, and the technically similar coins do have national designs ( sides ) that contain relevant symbols pertaining to the Member State involved. 1 Some of the observed differences might emanate from different interviewing modes, and some changes could be attributed to a changed order of questions. Comparisons with previous waves are therefore need some caution. Summary Report, page 7
The graphic design of the euro notes and coins The euro banknotes have partly different designs from country to country; DK/NA; 21 The euro banknotes look exactly the same in all countries; The euro coins have partly different designs from country to country; DK/NA; 22 The euro coins look exactly the same in all countries; 41 Q3-Q4. What do you think, which of the following statements is correct? Apparently, citizens are generally unaware of the different levels of required uniformity for euro coins and notes: either persons think that both are identical in each country of the euro-zone (e.g. those in the Czech Republic and Poland) or they are convinced that the national design appears both on the coins and the notes (e.g. Slovenia and Malta). Generally, every fifth New Member State respondent did not attempt to give a response to the question: they said they don t know. Euro banknotes look exactly the same in all countries (%) Euro coins have partly different designs from country to country (%) Czech Rep. 61 Slovenia 67 Estonia 57 Estonia 57 Poland Malta 56 Hungary Slovakia 53 Latvia Lithuania 48 Slovakia 41 Latvia Lithuania Hungary Slovenia Cyprus 41 Cyprus 30 Czech Rep. Malta 27 Poland Slovenians, being close to introduction, are particularly alert to the national content of the coins, reflecting local debate about the choice of symbols proposed for the face of their coins. Estonians were the best-informed overall: being the only country where the majority got the right answers for both questions. In the other countries the majority of the public is still poorly informed about this aspect of the common currency. We can make a similar diagnosis if we look at a trivia question related to the euro-zone: asking about the number of countries they think already use the euro. Compared to earlier waves, fewer citizens admitted that they did not know the right answer - although the proportion of those who answered the question correctly has not risen at all. The majority of persons in recently acceding countries do not know that there are 12 countries in the euro-zone, as only % of respondents were able to point to this figure. One quarter of such people believe that only 6 countries use the euro, while every fifth person believes that the euro has been adopted by each of the old member states. page 8
Number of countries currently in the euro-zone (%, 10) 6 countries 12 countries 15 countries 25 countries [DK/NA] 04/2006 23 19 3 17 09/2005 18 16 26 09/2004 15 16 28 Q5. According to you, how many EU countries have already introduced the euro? The variation among countries is limited: the proportion of persons who were able to answer the question correctly ranges from 31% in Lithuania to 43% in Slovenia. Yet even in Slovenia, % believe that the euro is now in use in all 15 old member countries. The number of countries that use the euro might not be vital information for most citizens of accession countries, but notions about the possibility to opt-out does have a more direct influence on the national politics of New Member States. The majority of citizens in each country studied currently believe that their nation has a choice about whether or not they will join the Monetary Union and, thus, whether they will adopt the euro (69% v. only 26% having an opposite opinion). Though, in fact, the Accession Treaties left no such choice for these countries. Can the country decide whether or not to join the EMU? yes no DK/NA 100% 90% 80% 70% 60% 50% 5 5 6 3 20 26 25 27 31 9 7 4 6 9 8 27 41 % 30% 69 77 70 67 66 64 61 56 56 53 52 20% 10% 0% 10 PL HU CY SI LT MT EE SK LV CZ Q5bis. Can (OUR COUNTRY) choose whether or not to introduce the euro? Especially Poles and to a lesser extent Hungarians, Cypriots and Slovenians are convinced that they still have complete sovereignty when it comes to choosing their currency; while people in the Summary Report, page 9
Czech Republic and in Latvia are least likely to say that their country is free to opt out of adopting the Union s common currency. We asked about the expected date of the introduction of the euro. Despite the belief that countries are free to choose whether or not to join the EMU, hardly anyone in the New Member States chose to answer that the euro will never be adopted in their country (1%). Opinions regarding this question are roughly in line with the level of preparedness for joining the euro-zone. Virtually everyone in Slovenia predicts entry up till 2008 (having a modal expectation of occurring precisely in 2007); and a decisive majority in Malta, Cyprus, Lithuania and Estonia foresee a switchover in the next two years. While most Latvians believe that they will adopt the euro by 2008, almost three out of ten put the date in the 2009-2010 time period. Slovakia, that only recently joined the ERM II. system, has a general expectation of joining the euro-club before the end of the decade (i.e. 66% put the date between 2009 and 2010). The countries not yet in the waiting room for the euro-zone are least likely to expect a change before the end of the decade. The Polish are least certain about their date, with one out of five citizens saying that they don t know what date they can expect for a euro introduction. Hungarians see their accession to the euro-area in the most distant future, for 12% expect this to happen beyond 2013. In the Czech Republic citizens predominantly expect a euro introduction by 2010, although every fifth respondent puts this after 2010. Expected date of the adoption of the euro up till 2008 2009-2010 2011-2012 2013 or later never DK/NA 100% 90% 80% 70% 60% 50% % 30% 20% 15 8 14 1 99 10 7 1 1 4 8 86 84 16 10 12 1 21 3 4 10 14 72 71 7 2 5 66 21 10 18 9 8 9 12 12 21 58 10% 0% 22 Q5ter. When, in which year do you think the euro will be introduced in [OUR COUNTRY]? % by country 19 15 12 10 SI MT CY LT EE LV SK PL CZ HU 7 page 10
Information and information channels The level of factual knowledge about the euro is not particularly high in the New Member States. The question is, though, to what extent are citizens content with the level of information available for them. Evolution of self-perceived information level regarding the euro (%, 10) informed informed Not very informed Not at all informed [DK/NA] 04/2006 5 43 18 2 09/2005 3 16 1 09/2004 3 31 48 16 2 Q6. To what extent do you feel informed about the euro? Do you feel : The self-perceived euro-related knowledge has improved in the last year, likely due to effective information dissemination in some Member States. We found marked increase in self-perceived information level in Slovenia, the Czech Republic, Slovakia and Lithuania. The majority of citizens in the region still think that they are not so informed about the euro (six out of 10 respondents said so.) Overall, 5% believe that they are very informed about the euro, and another % report that they are informed. On the other hand, almost every fifth citizen claim they are not at all informed about the common. Perceived information level regarding the euro, by country % Well + very informed % Not very + not at all informed 2006 2005 2004 2006 2005 2004 10 60 67 65 SI 80 60 57 20 CZ 48 31 33 50 67 63 SK 45 28 52 66 70 LT 31 31 56 69 68 CY 43 62 56 56 EE 30 63 65 68 HU 66 62 65 MT 33 65 70 68 PL 31 65 69 64 LV 31 28 27 68 71 72 Summary Report, page 11
The self-reported level of information does not necessarily coincide with actual levels of knowledge, at least based on the trivia questions we asked regarding the euro. The majority of Slovenians say they are informed about the euro, but only a minority is able to correctly say how many countries there are in the euro-zone, whether or not Slovenia can decide about adopting the common currency, or even point out the nuances concerning how national designs are to appear on the coins and notes. At the same time, almost every Slovenian is familiar with the euro; they have seen and have used it before. This indicates a different expectation regarding information : citizens appear to be less interested in the global aspects of the EMU, though they seem to be content if they are informed about the changeover scenario and as regards key information about the money itself (see details later in the report). Nevertheless, the citizens of some countries claim to be seriously deprived of euro-related information: Latvians, Poles and the Maltese are most likely to say that they are not sufficiently informed about the common currency. Desired timeframe for being informed on the euro (among those not informed, %) As soon as possible A few years before A few months before A few weeks before DK/NA 100 90 80 70 60 50 3 4 5 4 20 33 11 30 6 5 2 5 3 2 3 3 3 4 10 6 7 7 4 2 4 9 24 23 28 30 15 17 23 6 30 25 33 33 30 20 10 28 61 31 28 25 25 25 0 10 CY MT LT SI SK EE CZ PL LV HU Q7. When would you like to be informed about the introduction of euro in (OUR COUNTRY)? In Cyprus, and to a lesser extent in Malta and Lithuania too, there is an immediate demand for information among the majority of those who are not currently informed about the euro. In several countries, however, a significant number of people will not look for more information until euro adoption becomes a more tangible reality. In Poland, Latvia, Hungary and the Czech Republic those who are not yet sufficiently informed about the euro generally do not expect further information until a few years or even a few months before the changeover. Summing up those who request immediate information with those who prefer to be informed at least a few years before the changeover, we see that the majority expects information about the introduction of the euro in advance. page 12
Trust is a key factor in information provision: people differentiate between possible sources primarily based on their assessments of how trustworthy a particular source is. It is therefore essential to provide the necessary information through channels that are widely trusted in countries that plan to adopt the euro. Traditionally, as previous measurements have already established, national central banks are the most trustworthy sources of information regarding the euro and issues related to a changeover. Currently an average of 77% of citizens expresses their confidence in national central banks. institutions come in a close second, with 70% trusting them about euro-related information. In contrast, national public administrations (national and regional authorities) were trusted by only half of the citizens interviewed. Trusted distributors of information and campaigns (-10, %) National Central Bank 77 Institutions 70 Commercial banks Government, national or regional authorities Public administration 52 50 Consumer associations 49 Journalists 43 Trade unions, professional organisations, etc 0 10 20 30 50 60 70 80 90 Q8. For each of the following institutions or groups, please tell me if you would trust information they provide on the changeover to the euro, or not? (% trust shownon -10 level) The least trusted group is one that consists of professional associations and trade unions. Similarly, there is only moderate confidence in journalists across the New Member States, at least as conveyors of euro-related information. Of course, the above results are not universal for each country - and national communication plans will have to primarily take into account the local environment in which they have to be effective. Nonetheless, in every country the Central Bank is the prime source of information that citizens will turn to with confidence when it comes to the euro and any switchover. institutions make the top three in every country as, indicating a key role for them with regard to the information and communication processes used by the Commission and the ECB. Most trusted information sources in each country (% trust) CZ EE LV LT CY Central Bank 86 Central Bank 80 Central Bank 78 Central Bank 70 Central Bank 85 Institutions 74 Commercial banks 74 Government, authorities 71 Institutions 65 Institutions 62 Institutions 63 Government, authorities 58 Journalists 45 Government, authorities 76 Institutions 72 HU MT PL SK SI Central Bank 86 Central Bank 85 Central Bank 71 Central Bank 88 Central Bank 89 Institutions 80 Government, authorities 66 Commercial banks 83 Institutions 70 Institutions 66 Consumer associations 55 Institutions 78 Commercial banks 70 Consumer associations 79 Institutions 78 Summary Report, page 13
Another key aspect of a successful information and communication campaign will be the medium used to distribute information. We asked our respondents to tell us where they would like to receive useful information about the euro and the changeover. Normally, communication campaigns are designed on the basis of audience measurement data rather than self-reported preferences of information placements, as the latter is reported less accurately. However these results might add a dimension that go beyond the use of most expensive mass media channels (the option most preferred by citizens). The most preferred information channel is television. Independently of the content of information, Eurobarometer consistently finds that people prefer to be informed via the screen of their television about anything that might be relevant to them. It is interesting to note that almost nine in ten citizens named banks as their favoured locations of information while, other Eurobarometer studies suggest that the proportion of those who regularly use bank services is significantly lower than this (45% in the had a current account in 2003). Preferred channels for information campaigns (-10, %) On television 92 In banks In newspapers, magazines 87 85 On the radio On the Internet 78 81 In schools and other places of education and training 73 In public places In your letter box In the workplace 62 60 64 In supermarkets and shops 0 10 20 30 50 60 70 80 90 100 50 Q9. Where would you like to receive useful information on the euro and the changeover? The third most favoured channel is that of newspapers and magazines, this is followed by the radio and the Internet (with almost four out of five citizens preferring this as a way of receiving useful information about the euro again, a proportion that exceeds the number of those who actually use the Internet in these countries). Even the least desired place for disseminating information (supermarkets) was mentioned by half of citizens, indicating a general need for easily accessible and readily available information on the subject. As to the content of the information required, citizens are convinced that each of the topics we suggested for inclusion in the euro information campaign are more or less essential requirements. The most important among these is the value of the national currency in euros; citizens almost unanimously noted this element as an essential aspect of a euro campaign. Similarly important is providing information about how to avoid being cheated in euro conversions until a full changeover has taken place. Almost as essential is to have information provided about the general scenario of how the euro will be introduced into one s country, i.e. the important dates and milestones of exchanging their current legal tender to the euro. People are relatively familiar about the euro looks, and this aspect of the euro considered being the least essential element of an information campaign, however in page 14
this respect country differences are pronounced, ranging from only 67% in Lithuania to 90% in Poland. Preferred topics for information and campaigns (-10, % essential) The value of one euro in [CURRENCY] 93 How to avoid being cheated in euro currency conversions 92 The way the euro will be introduced in [COUNTRY] 90 The practical implications of the euro regarding your salary. your bank account 88 The social, economic or political implications of the euro 86 What notes and coins in euros look like 82 0 10 20 30 50 60 70 80 90 100 Q10. In your view, which of the following issues about the euro are essential to be covered in priority by the information campaign? Most activities that have been a part of euro introduction campaigns in the current euro-area are considered to be essential in the New Member States too. A dual display of prices is found most essential, both in shops and with utility bills. Most people expect that advertisements will explain the situation in newspapers and on television. Most people do not actually have a pay slip, but seven out of ten would see this way of operating as essential as in preparation for a euro switchover. People consider leaflets and brochures least necessary in their personal preparations for euro adoption. Information campaign actions judged to be essential (% essential, ) 2 2006 2005 2004 Dual display of prices in shops 86 79 81 Dual display of the amount on bills (electricity, gas, etc) 76 69 70 Newspaper advertisements 72 73 - TV advertisements 71 73 78 Dual display on your pay slip 71 66 66 Radio advertisements 64 64 66 Leaflets / Brochures 62 61 64 Compared to the results with previous years, media tools received similar support (with a slight decline in preferences as regards TV spots over these two years), while dual displays now enjoy an even higher support than in 2004 or 2005. 2 Question text: Here is a list of various information campaign actions. Could you tell me, for each of them, whether you would find it essential or not essential to prepare yourself for the euro? Summary Report, page 15
Perceptions of and support for the single currency The overall climate has become more positive again regarding euro introduction than it was in 2004 or 2005. This is, however, not in reflection of a general trend across the region but is the result of a rather radical positive change in attitudes in the most dominant country of the region, Poland. Overall, 52% in the New Member States believe that adoption of the euro will have, on balance, positive consequences for their country. Consequences of the introduction of the euro (%, -10) For country On personal level negative; 7 [DK/NA]; 15 positive; 8 negative; 10 [DK/NA]; 17 positive ; 7 negative; 26 positive; negative; 26 positive; Q12. Do you think the introduction of the euro would have positive or negative consequences for (OUR COUNTRY)? Q13. And for you personally, do you think that it would be positive or negative if the euro would be introduced? Generally, citizens expect that most of the advantages will be more positive to their country than for themselves. Only 8% think that the introduction will have a very positive, and % that it will have rather positive then negative effect for the country. Similar figures on a personal level are lower, 7% expect very positive, and % rather positive consequences when it comes to adopting the common currency in their country. A significant minority of % expect negative personal consequences, and almost as many citizens (33%) fear a similar outcome for their country. 15-17% can t decide if the euro will bring positive or negative consequences for their country or for themselves. Looking at the overall trends, we are able to see a bounce-back from the temporary disappointments that Eurobarometer measured last September. Current results are generally closer to the more favourable 2004 figures than to those of 2005. People in Slovenia are the most optimistic about expected consequences of the euro for their country (with a similar level being found in 2004). Those in Poland and Hungary although quite far even from the exchange rate mechanism are the second and third most hopeful regarding the potential benefits to their country. The changes in Hungary are not overly surprising, -- since 2004 the majority has been optimistic about the euro. Slovaks, after they joined the ERM II. system, are more positive regarding future introduction of the single currency. Maltese and Cypriots continue to be most pessimistic about the possible consequences of changing their currency. Cypriots seem to be consistently disillusioned as regards the euro in most factors embraced within this survey. Compared to the 2004 figure, optimism has declined by 14 percentage points regarding possible national-level consequences of euro introduction. Current measurements in every country are generally consistent with those of previous years, with some movement in a few member states - as outlined later in more detail; the change has been substantial only in Poland. While the country is probably is still far away from joining the ranks of countries that use the single currency, the Poles are starting to think about the euro more positively than they did beforehand. Currently, 55% of those interviewed thought that joining the page 16
EMU will have quite positive consequences, while only % think the opposite. The change in level of optimism is a stunning +18 percentage points, and negative attitude differences are of the same order of magnitude, being -17 points since September, 2005. This is of course related to the general perceptions of membership benefits, and the more positive attitudes toward the Union in general as. Consequences of the introduction of the euro: positive consequences for the country 70 04/2006 09/2005 09/2004 60 50 52 58 56 55 54 54 41 49 45 45 45 49 33 30 20 10 0 10 SI PL HU SK EE CZ LT LV CY MT Q12. Do you think the introduction of the euro would have positive or negative consequences for (OUR COUNTRY)? Time will tell if this change is just a temporary effect of the political situation Poland has been having since the Autumn of 2005 - or whether it is a more enduring change in attitudes. An argument that tends to support the second hypothesis is that we can see the same sharp increase in how positively Poles see the personal consequences of any future changeover. An indication of how recent this change might have been is that our Polish respondents did not report a similarly strong shift in their wider environment. DK/NA; 19 much against; 9 Opinion climate regarding the euro introduction much in favour; 8 Taken as a whole, more people report a positive than a negative climate of opinion in their environment. With one fifth of all respondents having no clear opinion, % believe that most people they know are supportive of their country joining the euro-zone. Almost as many, four out of ten, citizens say that the people they know are rather against introduction of the euro which is 6 percentage points less than in 2005, and -2 compared to 2004. against ; 30 in favour; Q14. Generally speaking, are most people you personally know more in favour or against the idea of introducing the euro in (OUR COUNTRY)? At present, the majority of the citizens in four of the New Member States sense public disapproval of any changeover to the euro. Respondents in the Baltic countries and in Cyprus are more likely than not to say that the people they know are against the adoption of the single currency. Such perceptions are widespread in the Czech Republic, Slovakia, Malta and Poland as - although in these countries this is a minority position. Two countries in which the Summary Report, page 17
perceived opinion climate is clearly favourable (with less than a quarter reporting any opposition in their wider surroundings) is Slovenia and Hungary. Respondents environment AGAINST introduction of the euro 70 04/2006 09/2005 09/2004 60 59 50 55 54 52 53 53 49 45 45 41 41 48 49 48 45 30 31 25 24 22 22 22 20 10 0 10 LT CY LV EE CZ SK MT PL SI HU Q14. Generally speaking, are most people you personally know more in favour or against the idea of introducing the euro in (OUR COUNTRY)? Respondents seeing the people they know are against or very much against of introducing the euro, % Besides the rational aspects involved, changing a national currency is an emotional issue as. A national currency represents the autonomy of the nation-state, and contributes to the national identity of the community of users. Eurobarometer looked at how people related to a future changeover to the euro emotionally, by asking whether or not they are happy that the euro will replace their national currency. Are people happy that the euro will replace their national currency? (%, -10) happy happy unhappy unhappy DK/NA] 04/2006 9 13 10 09/2005 6 31 18 11 09/2004 8 31 16 10 Q15. Are you personally happy or not that the euro could replace the (NATIONAL CURRENCY)? Again, we find that citizens in the New Member States are increasingly prepared at least mentally to have their currency replaced by their joining the euro-zone: 48% say they are very or quite happy about a future changeover, which is a difference of +11 percentage points compared to 2005, and +5 since 2004. This is more than the proportion of those who gave a positive rational assessment of euro introduction (i.e. who said that the change will bring positive consequences for them), which was % (as noted earlier). page 18
Slovenes are by far the least attached to their current currency i.e. which will be abandoned after having been in use for only 11 years. A slim majority in Hungary and in Slovakia are also happy about the change. The majority has an opposite opinion in five of the New Member States (Cyprus: 52%, the Czech Republic: 52%, Lithuania: 56% - and a stronger majority in Estonia: 60% and Latvia: 64%). In these countries the majority is rather unhappy about the change waiting for them. Happy about the coming changeover? % + rather happy % + rather unhappy 2006 2005 2004 2006 2005 2004 10 48 53 47 SI 64 58 66 30 27 HU 56 49 56 33 SK 54 50 50 PL 50 54 49 MT 41 41 48 49 CY 49 52 53 CZ 33 52 58 55 LT 33 25 56 69 58 EE 31 24 60 64 57 LV 28 21 23 64 64 59 The trends are again mixed here: we saw a dip in most countries in 2005, and very little change compared to 2004. The two countries where changes have seemed to be consistent are Poland (with a significantly positive shift) and Cyprus (with a sustained decline since 2004). Also, Latvians while still the least happy nation have a clearly more favourable assessment of the changeover than in previous years. Summary Report, page 19
Expectations and fears regarding adoption of the euro Price stability is one of the main objectives of EMU. The Central Bank s track record has been impressive with low inflation rates not exceeding 2.4% per annum since the introduction of the euro in 1999. Against this background, the survey also tests the expectations of the citizens in the new Member States as regards price stability. In contrast to previous experience and empirical evidence related to euro introduction in the current twelve Euro countries, most citizens in the New Member States fear that introduction of the euro will increase inflation in their country. The proportion of those who trust the euro as a tool to maintain price stability has risen by 5 percentage points, but still % are pessimistic in this respect. About every fifth respondent was reluctant to give an opinion on this question. This assessment is not universal across the region however. In Hungary, more people see the euro as a vehicle for a more stable financial environment than as a threat to the current level of price stability. In every other member state the majority is concerned that the euro will raise prices, even in those countries where a belief that the euro might help maintain price stability is not as low as in the Baltic countries or in New Member States from the Mediterranean region. The euro will help to maintain price stability 50 04/2006 09/2005 09/2004 45 45 45 30 25 20 15 25 24 20 21 24 23 27 22 18 18 19 14 20 18 15 14 17 17 17 22 20 19 15 15 15 10 5 0 10 HU SK PL SI CZ LT LV EE MT CY Q17. Do you think the euro will help to maintain price stability or, on the contrary, increase inflation in (OUR COUNTRY)? (% will help to maintain price stability shown) Opinions in this respect have been relatively stable in most countries over the past three years. An important change is currently taking place in Slovenia, where the dual display system is already in place - though, in parallel with this, fear of potential inflation at or after a changeover has risen to a level that we have only seen in the most sceptical countries so far. Almost two thirds of the Slovenes now think that euro introduction will give a rise to inflation, which is only marginally less to what we see in Cyprus and Malta (69% and 67%, respectively). The current Slovenian rating means a 16-point increase in the pessimistic - and a 9-point decrease for the optimistic opinion as they are approaching the day of introduction. page 20
The euro will give rise to the inflation 80 04/2006 09/2005 09/2004 70 60 50 48 48 69 69 59 67 61 62 71 65 64 61 62 61 61 55 54 54 49 47 43 54 45 43 30 31 26 27 20 10 0 10 CY MT SI LV EE LT CZ PL SK HU Q17. Do you think the euro will help to maintain price stability or, on the contrary, increase inflation in (OUR COUNTRY)? (% will increase inflation ) There is wide consensus in the New Member States that the euro is an international currency, one similar to the Japanese Yen or the US Dollar. This opinion has not really changed over the course of the past three years, and there is a very little variation across countries in this regard. Slovenes are most likely to agree here, with 81% answering yes; while Hungarians, alongside Cypriots, are least convinced about such status (with 72% agreeing in both countries). Status of the euro as an international currency (%, -10) Yes No [DK/NA] 04/2006 74 18 8 09/2005 72 20 8 09/2004 73 20 7 Q18. Do you think that the euro is an international currency like the US dollar or the Japanese Yen? There are several advantages of belonging to the euro-zone that respondents universally acknowledged. An undisputed advantage of joining the euro-zone concerns tourists: all respondents in every country agreed that it will be more convenient to travel in another country of the euro area. Nine out of ten people also widely agree that it will be easier to shop in other countries using the euro, which reflects a +10 point increase since 2005. More respondents than before agreed that comparing prices will become easier between countries in the euro-zone (83%, +13). Similarly, almost 8 out of ten respondents (79%, +4) see benefits in the elimination of exchange charges within countries of the Summary Report, page 21
euro area. In each of these respects country variations are small: the dominant opinion is agreement throughout the ten countries. Expected positive effects of joining the euro-zone (%, -10) d) Will it be more convenient for persons who travel in other countries using the euro? b) Will make it easier to shop in other countries that use the euro? a) Will it allow you to easily compare prices with other countries that use the euro? c) Will it save money by eliminating currency exchange charges in other countries that use the euro? e) Will it protect (OUR COUNTRY) from the effects of international crises yes no 2006 2005 2004 2006 2005 2004 95 92 92 3 4 5 90 80 82 7 13 12 83 70 73 11 19 18 78 74 77 13 12 11 - - 30 - - For the respondents, a much less evident benefit of accession to the EMU is the protection - or buffer - it provides in cases of international economic or other crises. Only % agree that the euro will be able to provide such protection, while 3 in ten respondents disagreed. Almost as many (28%) were not able to decide whether or not such benefits might be expected from euro-zone membership. Can the euro protect the country from the effect of international crises? 60 yes 50 30 30 50 50 49 25 27 45 30 30 26 28 no 33 33 20 10 0 10 Slovakia Hungary Slovenia Cyprus Malta Poland Lithuania Latvia Czech Rep. Estonia Q19. Do you think that the euro? e) Will protect (OUR COUNTRY) from the effects of international crises The most ambivalent countries are Lithuania, Latvia, the Czech Republic and Estonia in this respect. In the other six countries a clear majority agrees that such advantages can be expected from belonging to the euro area. page 22
Looking at the various economic or political effects of euro introduction, people agree that enlargement of the euro zone with their country will improve Europe s global significance, and they also tend to believe that it will have a positive effect in the area of public finances. People are more sceptical regarding whether a change to the euro will ease their debt burdens, and the relative majority do not expect that it will help to increase employment or boost economic growth. Potential political and economic advantages of adopting the euro Will ensure lower interest rates, lower debt charges Will ensure sounder public finances Will reinforce the place of Europe in the world Will improve growth, employment DK/NA; yes; DK/NA; 25 yes; no; 20 DK/NA; 12 DK/NA; 22 yes; no; 31 no; 30 yes; 68 no; In your opinion, what are the main advantages of the adoption of the euro for (OUR COUNTRY)? Will ensure lower interest rates, lower debt charges Will ensure sounder public finances Will reinforce the place of Europe in the world Will improve growth, employment Yes no yes no yes no yes no 10 31 30 68 20 CZ 23 43 58 28 25 57 EE 21 33 56 22 CY 27 73 13 LV 61 26 LT 26 63 18 52 24 HU 52 23 66 19 75 13 49 30 MT 27 30 24 66 13 PL 30 70 21 SI 47 53 30 68 22 22 66 SK 31 71 16 50 As the table shows, these opinions are consistent across countries of the region, though there are a few notable exceptions. In contrast to the regional average, both the Baltic and the Mediterranean countries tend not to believe that credit charges will be more favourable after joining the euro zone. As to whether the common currency can help a country have healthier public finances, disbelievers are in a majority in the Czech Republic only, while the optimists and pessimists break even in Estonia and Latvia in this respect. There is no major doubt in any country regarding a stronger global position of Europe after a euro-zone enlargement. The most controversial statement is whether or not introduction of the euro can increase economic growth and employment. A resounding no can be to be heard in this respect from the Czech Republic, Slovakia, Latvia, and especially from Slovenia. At the same time, the majority of Hungarians, Cypriots, Lithuanians, Maltese and by a slim margin the Poles hope for such an effect after having entered the euro zone. Summary Report, page 23
More than half of citizens in the New Member States agree that introducing the euro into their country will make them feel more, while % disagreed with the statement. Using the euro will make people feel more 80 agree 70 60 50 30 55 69 26 66 64 28 58 57 53 47 49 disagree 45 45 60 20 10 0 10 CZ SI MT PL SK LV CY EE LT HU Q21. Could you tell me for each of the following statements if you agree or disagree? e) The usage of the euro instead of the (NATIONAL CURRENCY) will make us feel more than now The variation is quite large across countries. Respondents from the Czech Republic, Slovenia and Malta express very strong agreement, while the public in Cyprus, Estonia and Lithuania are rather ambivalent concerning this question. Most Hungarians disagree - they do not believe that using the single currency will make them more seeing the issue it in more instrumental terms. There are several fears people refer to in discussions regarding the euro. Many are only shared by a minority in the New Member States: most people are not concerned about personal inconveniences caused by any changeover; and they are also not so worried that their country will lose control over its economy. Only a third of citizens said that they feared that abandoning their old and established currency will have a negative effect on their country s identity. What persons are clearly afraid of are potential abuses around the time of the changeover. Three quarters of persons are worried that they will be cheated during such a changeover. Fears regarding the adoption of the euro The replacement of the [CURRENCY] by the euro will cause you personally a lot of inconvenience You are afraid of abuses and cheating on prices during the changeover Adopting the euro will mean that [COUNTRY] will lose control over its economic policy Adopting the euro will mean that [COUNTRY] will lose a great deal of its identity DK/NA; 7 yes; DK/NA; 3 no; 23 DK/NA; 13 yes; DK/NA; 9 yes; no; 58 yes; 74 no; 59 no; 58 Could you tell me for each of the following statements if you agree or disagree? page 24
Those who are from the more sceptical countries tend to be more concerned about each of these issues as. The replacement of the [CURRENCY] by the euro will cause you personally a lot of inconvenience You are afraid of abuses and cheating on prices during the changeover Adopting the euro will mean that [COUNTRY] will lose control over its economic policy Adopting the euro will mean that [COUNTRY] will lose a great deal of its identity agree disagree agree disagree agree disagree agree disagree 10 58 74 23 59 58 CZ 41 53 69 28 61 49 EE 41 72 21 48 CY 50 83 13 43 45 45 48 LV 50 74 22 54 66 27 LT 45 75 21 HU 52 64 19 69 19 71 MT 47 45 79 15 26 54 54 PL 30 63 79 18 28 59 63 SI 21 78 70 30 63 62 SK 52 68 25 30 55 49 Potential cheating and abuses during the switchover make most people concerned in every country. In most countries the majority (even if a slim majority) is, however, not worried about what the personal inconveniences a changeover will mean to them; those who are concerned about this are in majority only in Malta. Similarly, there is only one exception to the general trend of whether or not the countries will be able to retain or will lose control over their economic policies after they have joined the euro-zone: Latvians think in a majority that control will be lost after adoption of the euro (although notably large minorities share this opinion in a number of other countries, too). We find a large diversity of opinions regarding the relationship between one s currency and national identity. The clear majority in the new Nordic countries -- the Estonians, Latvians, and Lithuanians -- agree that losing their newly established currencies will harm their national identity. There is very little agreement with this position in Hungary, Poland or Slovenia, where citizens rather look at the economic benefits the change might mean for managing their economies. Summary Report, page 25
Flash EB Series #183 Introduction of the euro in the new Member States Wave 3 Country Scorecards THE GALLUP ORGANIZATION page 26
Gallup Europe CZECH REPUBLIC Introduction of the euro in the Public Preparedness Scorecard FLASH EUROBAROMETER 31st of March 5th of April, 2006 Support to the introduction of the euro Q.15. Are you personally happy or not that the euro could replace the Czech koruna? DK/NA; 8 happy ; 10 CZ unhappy ; 18 unhappy ; Q6. To what extent do you feel informed about the euro? Do you feel Not at all DK/NA; 2 inf ormed; 6 inf ormed; 14 Not v ery inf romed; week s bef ore; 7 months bef ore; 13 18 25 43 10 9 DK/NA; 2 happy; Note: new member states (inner pie graph) inf ormed; 48 33 Happy / very happy Self-perceived level of information Note: new member states (inner pie graph) Need for immediate information Q7. When would you like to be informed about the introduction of euro in the Czech Republic? [AMONG THOSE NOT WELL INFORMED] As soon as possible; 28 A few years bef ore; 25 CZ 2010 48 33 31 Well informed Dominantly expected date of joining the euro zone Familiarity with the euro Q1/2. Have you already seen / used euro banknotes / coins? 69 61 75 83 70 78 Have seen euro '04/09 '05/09 '06/04 Help to maintain price stability Ens ure lower interes t rates, lower debt charges Ensure s ounder public f inances Reinf orc e the plac e of Europe in the wo rld Improv e growth, employ ment Protect the country from the eff ects of international cris es Make people f eel more Negative expectations The euro will increase the inf lation banknotes coins Potential socio-economic benefits 22 18 23 25 33 63 59 43 68 58 55 69 75 65 04/'06 CZ 04/'06 CZ 09/'05 69 74 Have used euro Most trusted information sources Af raid of abuses and cheating on prices during the changeov er 74 69 66 Q8... please tell me if you would trust information they provide on the changeover to the euro, or not? National Central Bank Institutions Commercial banks 74 74 86 The euro will mean that countries will lose a great deal of their identity The changeov er will cause personally a lot of inconv enience That (our country ) will lose control ov er its economic policy 45 41 04/'06 CZ 04/'06 CZ 09/'05 GALLUP www.gallup-europe.be Summary Report, page 27 Commission
ESTONIA Introduction of the euro in the Gallup Europe Public Preparedness Scorecard FLASH EUROBAROMETER 31st of March 5th of April, 2006 Support to the introduction of the euro Q.15. Are you personally happy or not that the euro could replace the Estonian kroon? DK/NA; 9 happy; 4 EE unhappy ; 10 9 happy; 27 48 22 13 unhappy; Q6. To what extent do you feel informed about the euro? Do you feel DK/NA; 1 Not at all informed; 3 inf ormed; 13 Not v ery inf romed; 50 A few weeks before; 7 months bef ore; 18 25 43 Note: new member states (inner pie graph) DK/NA; 3 inf ormed; 33 31 24 Happy / very happy Self-perceived level of information Note: new member states (inner pie graph) Need for immediate information Q7. When would you like to be informed about the introduction of euro in Estonia? [AMONG THOSE NOT WELL INFORMED] As soon as possible; 31 years before; 30 Most trusted information sources Q8... please tell me if you would trust information they provide on the changeover to the euro, or not? National Central Bank Gov ernment, national or Gov ernment, national regional authorities Institutions 30 EE Well informed 2008 Dominantly expected date of joining the euro zone 65 71 80 Familiarity with the euro Q1/2. Have you already seen / used euro banknotes / coins? 78 82 77 64 72 73 Have seen euro '04/09 '05/09 '06/04 Potential socio-economic benefits Help to maintain price stability Ens ure lower interes t rates, lower debt charges Ensure s ounder public f inances Reinf orc e the plac e of Europe in the wo rld Improv e growth, employ ment Protect the country from the eff ects of international cris es Make people f eel more Negative expectations The euro will increase the inf lation Af raid of abuses and cheating on prices during the changeov er The euro will mean that countries will lose a great deal of their identity The changeov er will caus e personally a lot of inconv enience That (our country) will lose control ov er its economic policy banknotes coins 17 17 21 33 33 58 55 48 49 41 53 57 56 62 61 68 74 72 66 61 66 63 Have used euro 04/'06 EE 04/'06 EE 09/'05 04/'06 EE 04/'06 EE 09/'05 page 28 GALLUP www.gallup-europe.be Commission