Economic Convergence between Macedonia and European Monetary Union Member States. The Five Maastricht Criteria

The euro was introduced on January 1, 1999. As of now, 16 European Union Member States have adopted the euro in line with the requirements of the Treaty, the most recent ones being Cyprus and Malta on January 1, 2008 and Slovakia on January 1, 2009. This implies that 11 Member States are at present not full participants in Economic and Monetary Union (EMU) and have not yet adopted the euro. In this paper, Macedonia is assessed the first time in respect of EMU‟s economic criteria. This is due to the fact that Macedonia wants to join the EU in the coming up years. It also has to be taken into account that Macedonia intends to adopt the euro in a second step in the near future whose currency has followed a high volatility over several years. This requires an analysis of how the Macedonia‟s economy would operate under conditions of irrevocably fixed exchange rates. The examination of the economic convergence process is highly dependent on the quality and integrity of the underlying statistics. The compilation and reporting of statistics, particularly government finance statistics must not be subject to political considerations. We suppose that the first analysis in this respect is not without any problems because of the data base available in Macedonia. However, we believe that our analysis of the Maastricht convergence criteria is very important and a milestone for the future economic policy decisions in Macedonia.