Introduction of the Euro in the New Member States

Transcription

1 European Commission Introduction of the Euro in the New Member States WAVE 2 Fieldwork: September 2005 Publication: November 2005 This document does not represent the point of view of the European Commission. The interpretations and opinions contained in it are solely those of the authors.

2 Introduction of the euro in the new member states - Wave 2 Report p. 1 Introduction of the euro in the new Member States Wave 2 Conducted by EOS Gallup Europe upon the request of the European Commission. This document does not reflect the views of the European Commission. Any interpretations or opinions expressed in this report are those of the authors alone. SURVEY: September 2005 ANALYTICAL REPORT: November 2005

3 Introduction of the euro in the new member states - Wave 2 Report p. 2 Table of contents TPRESENTATIONT...4 T1. Perception and support for the single currencyt...5 T1.1.T TInterest in the introduction of the eurot...5 T1.2.T TConsequences of the introduction of the eurot...7 T Consequences on national levelt...7 T Consequences on personal levelt...9 T1.3. Support for the single currencyt T Opinions of the respondents environmentt T Opinions on the replacement of the national currency by the eurot T The wished timeframe for adopting the eurot T Status of the euro as an international currencyt T2. Expectations and fears regarding the adoption of the eurot...17 T2.1. Practical consequences of the Euro changeovert T2.2. Fears regarding the introduction of the eurot T Abuses and cheating on prices during the changeovert T Loss of national identity due to the adoption of the eurot T Inconvenience due to the introduction of the eurot T Loss of control over the national economic policyt T Rise of the European identity?t T2.3. Consequences of the introduction of the euro on pricest T3. Knowledge and experiences with the eurot...31 T3.1. Citizens knowledge about the introduction of the euro and the euro-zonet T The obligation to adopt the eurot T Knowledge of the number of current Euro zone countriest T3.1.3T TExpected date of the adoption of the eurot T Knowledge of euro banknotest T Knowledge of euro coinst T3.2. Familiarity with the euro currencyt T Euro banknotest T Euro coinst T3.3. Where the usage of the euro currency takes placet... 43T

4 Introduction of the euro in the new member states - Wave 2 Report p Informing citizens on the euro Level, channels and content of information The overall feeling of information Timeframe for being informed on the euro Preferred distributors for information Preferred channels for information Preferred topics for information and campaigns Main actions essential for information campaigns CONCLUSIONS...54 ANNEXES - Tables - Technical Note - Questionnaire

5 P and Introduction of the euro in the new member states - Wave 2 Report p. 4 PRESENTATION The historical enlargement of the European Union 18 months ago will lead to an expansion of the European Monetary Union over the coming years. Once the 10 new Member States have achieved a sufficient level of sustainable economic convergence defined by the Maastricht Treaty, they will adopt the euro. There is no fixed time table for the introduction of the euro. The EU10 countries are a truly heterogeneous group, and the adoption process is subjected to the country specific situations. In general, each country has to reach a certain level of price and exchange rate stability and sound public finances. The country must also be a member of the Exchange Rate Mechanism ERM II a minimum of two years before adopting the euro. At present, six new Member States have joined the ERM II (Estonia, Lithuania, Slovenia, Cyprus, Malta, and Latvia) while the four largest countries, Poland, the Czech Republic, Slovakia and Hungary still remain outside the common exchange rate mechanism. Compliance with the Maastricht criteria is assessed every two years or by the request of a Member State. The next report will be produced in If one or more countries are evaluated to be ready to adopt the euro, a proposal to the Council of the European financial ministers will be submitted. Thus, the first likely date to have a new member in the euro-zone is in the beginning of the year Regarding to the introduction of the Euro in the New Member States, the European Commission keeps track on the general opinion, the level of knowledge and information, and the familiarity with the single currency of the citizens in the new Member States. The main themes in the report are the new Member States citizens interest and perception of the single currency expectations and fears concerning the adaptation of the Euro level of knowledge and experiences of the Euro feeling of being informed and preferred channels of information This study is second in line and follows a Eurobarometer survey conducted in September The content of the questionnaires, except minor changes in the wording of four questions and one new question, is consistent and allows us to detect the opinion trends during the preceding year. The report illustrates the current opinion climate in the EU10 considering the introduction of the Euro and highlights the changes occurred during the previous year. nd th The fieldwork of this survey was carried out between 2P 13P P of September The EOS Gallup Europe network interviewed over 10,000 citizens aged 15 years and above throughout the ten new EU Member States. Interviews were carried out by telephone in all countries except the Czech Republic, Latvia, Lithuania, Poland and Slovakia where face-to face interviews were conducted due to low telephone penetration rates. In Estonia, both interviewing methods were used. Further details of the methodology used are found in the technical note.

6 Introduction of the euro in the new member states - Wave 2 Report p Perception and support for the single currency The first chapter deals with the EU10 citizens general interest, perception and support for the introduction of the Euro Interest in the introduction of the euro - Slightly less than a half of the citizens in the new Member States are interested in the introduction of the euro in their country - Q1. Personally, would you say that the introduction of the euro (IN OUR COUNTRY) is a topic that you are interested in. Are you... - % EU10 Very interested Rather interested Rather not interested Not at all interested [DK/NA] 09/ % 38% 30% 19% 09/ % 39% 29% 19% 0% 20% 40% 60% 80% 100% In September 2005, 48% of the citizens of the new Member States indicate to be interested in the introduction of the euro in their country. This is 2 points less than in September On the contrary, there is a minor increase of one point in the number of respondents stating not to be interested, the score being 49% in In accordance with the results of 2004, the most interested respondents reside in Cyprus (73%), Slovenia (66%) and Hungary (64%) whereas those with the lowest level of interest are found in Latvia (59% not interested), the Czech Republic (56% not interested) and Poland (55% not interested). The changes at the EU10 level are rather small but when looking at the country by country results, differences between Member States can be detected. In Cyprus, Slovenia, Hungary, Lithuania, Malta and Slovakia, the level of interest in the introduction of the euro is 60% or more. Except in Hungary, the number of interested respondents in these countries stays stable or increases slightly compared to In the remaining countries, Estonia, the Czech Republic, Poland and Latvia, the share of interested citizens is less than 50%, and remains stable or decreases moderately.

7 Introduction of the euro in the new member states - Wave 2 Report p. 6 Q1. Respondents interested in the introduction of the euro - % country 09/ /2005 NMS 48% 50% CY 73% 72% SI 66% 62% HU LT MT SK 64% 63% 61% 62% 61% 60% 60% 69% EE CZ PL LV 43% 42% 42% 39% 41% 49% 53% 48% 0% 20% 40% 60% 80% Compared to year 2004, the largest increase in the amount of interested citizens can be found in Slovenia (+4 points) whereas the most notable decrease (-5 points) is detected in Hungary and the Czech Republic. What comes to the results according to the socio-demographic variables, very similar patterns can be noted in both years: Men are more interested than women in this topic (54% to 44% in 2005). Respondents in the age category of 55 years or more are less interested than the respondents in the younger age groups. In the category of years, the level of interest has gone up 6 points whereas in the two youngest categories, the number of interested respondents has decreased 5 points each. The longer the respondent has studied, the more likely he/she finds the introduction of the euro as an interesting subject. When comparing the occupational categories, self-employed and employees are more interested than manual workers or those without professional activity. Finally, persons living in urban areas (56%) are somewhat more interested in the topic than respondents living in rural zones (44%).

8 Introduction of the euro in the new member states - Wave 2 Report p Consequences of the introduction of the euro - The consequences both at national and personal level are perceived to be less positive than in Consequences on national level Q2. Do you think the introduction of the euro would have positive or negative consequences for (OUR COUNTRY)...? % EU10 Very positive consequences Rather positive consequences Rather negative consequences Very negative consequences [DK/ NA] 09/2005 4% 34% 33% 13% 16% 09/2004 6% 38% 30% 11% 15% 0% 20% 40% 60% 80% 100% In 2005, 38% of the respondents believe that the introduction of the euro in their country would have positive consequences. There is a decrease of 6 points compared to the EU10 average in Consequently, more people perceive the possible consequences as negative: in 2005 the share is 46% compared to 41% in The changes are more distinct at national level. In every Member State surveyed, the proportion of respondents seeing the consequences of the introduction of the euro as positive decreases. The most striking change, a decrease of 13 points, is found in Cyprus and Lithuania. Also in Slovenia, Slovakia, and the Czech Republic, the difference is notable, -10 points. The changes are proportional with the increases in the amount of respondents perceiving the introduction of the euro to have negative consequences. This kind of negative trend could be partly explained by the intensive debate on the European Constitution taking place during the year 2005, and by the effect of the negative results of the referendums in France and the Netherlands.

9 Introduction of the euro in the new member states - Wave 2 Report p. 8 NMS HU SI EE SK PL CY CZ MT LV LT Q2. Respondents believing that the introduction of the euro will have positive consequences - % country 09/ / % 35% 38% 44% 51% 54% 46% 56% 39% 44% 39% 49% 37% 41% 36% 49% 32% 38% 32% 35% 45% 45% 0% 10% 20% 30% 40% 50% 60% 70% Q2. Respondents believing that the introduction of the euro will have negative consequences - % country When observing more closely the country by country results, some countries stand out with more distinctive changes between 2004 and Considering both the amount of respondents seeing the introduction of the euro having positive consequences and those anticipating the opposite, the largest differences are found in Lithuania, Cyprus, and Slovakia. Several country specific factors can be assumed to explain this kind of development. In Lithuania, there has been a lot of public debate on the introduction of the euro in August and September 2005 (the survey was carried out 2-13 September). The campaign against the introduction of the euro has started with the main argument stating that the prices would go up with the adoption of the euro. NMS LT CY LV SK CZ PL EE MT SI HU 09/ / % 41% 41% 39% 48% 41% 48% 38% 47% 42% 46% 44% 45% 40% 45% 44% 44% 32% 35% 32% 55% 59% Also in Slovakia, the discussion has gained strength due to the plebiscites of the European Constitution. Also, the feedback of the respondents of this survey included more negative remarks of the euro and the European Union than a year before. In Cyprus, the general support of the EU membership went down 9 points according to the results of the EB63.4. This is presumably a consequence of the debate on the situation of Turkey and the Turkish Cypriot Community. Also, the support for the euro decreased 6 points according to the results of the EB % 10% 20% 30% 40% 50% 60% 70% What comes to the socio-demographic variables, no significant changes are detected compared to the remarks of the 2004 survey.

10 Introduction of the euro in the new member states - Wave 2 Report p Consequences on personal level Q3. For you personally, do you think that it would be positive or negative if the euro would be introduced? - % EU10 Very positive Rather positive Rather negative Very negative [DK/ NA] 09/2005 5% 31% 34% 15% 16% 09/2004 6% 34% 32% 13% 16% 0% 20% 40% 60% 80% 100% When asked in personal dimension about the consequences of the introduction of the euro, the trend is parallel to the one on national level. While in 2004, 40% of respondents felt the consequences would be positive at the personal level, the share diminishes to 36% in Furthermore, the proportion of those anticipating negative consequences goes up by 4 points, from 45% to 49%. Once again the differences are more prevalent when analysing the country by country results. When the consequences are evaluated on personal basis, in every country the share of respondents seeing the consequences as positive diminishes, and logically, the share of those seeing the consequences as negative increases. And again, the counties that stand out, especially due to the increase of respondents perceiving negative consequences, are Lithuania, followed by Slovenia and Cyprus. Q3. For you personally, do you think that it would be positive or negative if the euro would be introduced? Positive Diff Negative Diff NMS 35% -5 49% +3 HU 46% -5 33% +2 SI 45% -6 44% +13 CY 43% -9 51% +13 SK 40% -7 49% +8 MT 39% -3 42% +1 CZ 37% -5 49% +4 LV 37% -7 49% +8 EE 36% -8 49% +7 LT 32% % +15 PL 31% -3 52% +2

11 Introduction of the euro in the new member states - Wave 2 Report p Support for the single currency - The general perception on the introduction of the euro is more negative in 2005 than a year before Opinions of the respondents environment Q4. Generally speaking, are most people you personally know more in favour or against the idea of introducing the euro in (OUR COUNTRY)? - % EU10 Very much in favour Rather in favour Rather against Very much against [DK/ NA] 09/2005 5% 28% 32% 13% 23% 09/2004 6% 33% 30% 10% 20% 0% 20% 40% 60% 80% 100% In order to describe the general attitudes towards the euro, the respondents were asked to evaluate how the people they know feel about the introduction process. This is also a significant approach since the social environment has a reasonable affect on the opinions of people. The same slightly negative trend that is seen in previous subparagraphs is also detected here. In 2004, 39% of respondents in the EU10 perceived their acquaintances to support the euro. In 2005, the respective figure is 33%, 6 points less. On the contrary, the amount of those perceiving their environment to be against the introduction of the euro goes up by 5 points, from 40% to 45%. What is to be noted here as well, is the reasonably high percentage of those replying do not know which might indicate that the topic is not commonly discussed in the social environment of the respondents. The changes in time are again most notable at the country level. The countries where the most of the respondents, and also the majority, think that their environment is in favour of the introduction of the euro are Slovenia (48%) and Hungary (45%). The result is consistent with the 2004 figures but in both countries the share has gone down (respectively 9 and 10 points). On the opposite side, in Lithuania (59%), Cyprus (52%), and the Czech Republic (51%), more than half of the respondents think that people they know are against the introduction of the euro. In 2004, the countries with the highest proportion of respondents seeing their environment being against were the Czech Republic (48%), Poland (45%), and Latvia (44%). The change is explained by the reasonable variation in the country results during the year.

12 Introduction of the euro in the new member states - Wave 2 Report p. 11 Q4. Respondents seeing the people they know to be against the idea of introducing the euro in their country - % EU10 09/ /2005 NMS 45% 41% LT 40% 59% CY CZ 36% 52% 51% 48% LV 44% 49% SK MT PL 38% 49% 48% 46% 46% 45% EE 45% 41% SI HU 22% 24% 22% 31% 0% 20% 40% 60% 80% When having a closer look at the country by country results, significant changes in the shares of people stating that their acquaintances are against the introduction of the euro can be noted. First, in all countries the scores of the category against have gone up. Second, the changes are striking in Lithuania (+19 points) and Cyprus (+16 points). This follows the trend already detected in the question of the perceived consequences of the euro. Logically, while the amount of respondents perceiving their environment being against the euro increases, the amount of those choosing the opposite option decreases, this being the most notable trend, once again, in Lithuania and Slovakia (-11 points in both). Again, no notable changes concerning the socio-demographic variables are noted compared to the previous study. All in all, it can be concluded that the citizens of the EU10 perceive their environment to be more negative towards the introduction of the euro than a year ago.

13 Introduction of the euro in the new member states - Wave 2 Report p Opinions on the replacement of the national currency by the euro Q5. Are you personally happy or not that the euro could replace the (NATIONAL CURRENCY)? - % EU10 Very happy Rather happy Rather unhappy Very unhappy [DK/ NA] 09/2005 6% 31% 35% 18% 11% 09/2004 8% 35% 31% 16% 10% 0% 20% 40% 60% 80% 100% In 2005, 37% of respondents in the EU10 state to be happy about the idea of the euro replacing their national currency. This is 6 points less than was detected in At the same time, the proportion of those feeling unhappy about the process increases by 6 points, from 47% to 53%. Thus, over half of the respondents feel unhappy, and the percentage gap between the categories happy and unhappy increases from 5 points in 2004 to 16 points in In country by country analysis, a clear trend can be found: in every country the proportion of those feeling happy decreases whereas the proportion of those feeling unhappy increases. Respondents feeling the happiest about the replacement of their national currency are found in Slovenia (58%) and Hungary (49%). These are also the only two countries where the share of happy respondents outnumbers the share of those feeling unhappy. The result is parallel with the outcomes of the 2004 survey though, in both countries, the share of those feeling happy has decreased considerably, respectively 8 and 7 points. In the other end, we find the three Baltic countries, Lithuania (69%), Estonia (64%) and Latvia (64%), where most of the respondents feel unhappy about the introduction of the euro. As already mentioned in the 2004 report, the Baltic countries have a specific historical backdrop as being part of the former Soviet Union, and consequently, the national identity is fostered carefully. The reasonably recently achieved independence in these countries leads to willingness to preserve things strengthening the national identity, like the national currency.

14 Introduction of the euro in the new member states - Wave 2 Report p. 13 Q5. Are you personally happy or not that the euro could replace the (NATIONAL CURRENCY)? - % country Happy Diff Unhappy Diff NMS 36% -6 53% +6 SI 58% -8 34% +7 HU 49% -7 37% +4 SK 42% -8 50% +8 MT 40% -1 48% -1 CY 40% -9 53% +13 PL 34% -6 54% +5 CZ 33% -6 58% +3 LT 25% -9 69% +11 EE 24% -5 64% +7 LV 21% -2 64% +5 Once again, when looking at the results country by country, some variation can be depicted. In one year s time, the proportion of the respondents feeling happy has diminished in every country. The most notable changes are, again, found in Cyprus and Lithuania (-9 points in both countries). Logically, the share of those feeling unhappy has increased in every country except Malta. Likewise with the decrease in the amount of those feeling happy, this trend is the strongest in Cyprus and Lithuania. In Cyprus, the increase is 13 points and in Lithuania 11 points. In consequence, also in this question a clear negative trend in one year s time is found. Also in this case, the explanation for the changes is most likely found in the country specific features mentioned in sub chapter What comes to the socio-demographic categories, the same patterns as found in 2004 are repeated concerning this question. Men indicate to be more often happy about the introduction of the euro than women, so do respondents in the younger age groups and those having studied longer.

15 Introduction of the euro in the new member states - Wave 2 Report p The wished timeframe for adopting the euro Q6. When would you like the euro to become your national currency? - % EU10 As soon as possible After a certain time As late as possible [DK/NA] 09/ % 32% 46% 5% 09/ % 36% 40% 5% 0% 20% 40% 60% 80% 100% The support for the euro was also evaluated by asking the respondents when they would like to have the euro introduced in their country. In both 2004 and 2005, the largest proportion of the citizens chooses the option as late as possible, the score being 6 points higher in 2005 than a year before. Only 17% indicate that the euro should become the national currency as soon as possible. This is 2 points less than in Also, the amount of those saying they want to adopt the euro as a national currency after a certain time decreases from 36% to 32%. Consequently, it can be concluded that the respondents are less in a hurry to adopt the euro than a year ago. Slovenians and Hungarians continue to be the ones finding the adoption of the euro the most acceptable and they are clearly ahead of the rest of the new Member States. 32% of the respondents in Slovenia and 30% in Hungary wish to adopt the euro as soon as possible, even though the percentages are down respectively 6 and 2 points compared to the 2004 results. The lowest rates of those wanting to adopt the euro as soon as possible are found in Latvia (12%) and Lithuania (12%), likewise was the case in The highest proportions of respondents willing to postpone the introduction of the euro as late as possible, are found in Latvia (52%) and Poland (50%), where approximately half of the citizens choose this option, whereas in 2004, the least enthusiastic respondents were found in Estonia (47%).

16 Introduction of the euro in the new member states - Wave 2 Report p. 15 Q6. When would you like the euro to become your currency? - % country As soon as possible Diff After a certain time Diff As late as possible Diff NMS 17% -2 32% -4 46% +6 SI 32% -6 29% -1 32% +7 HU 30% -2 33% -9 29% +8 CY 20% -1 32% -5 44% +10 EE 19% +4 27% -4 47% 0 SK 16% -2 36% -5 42% +9 PL 15% -2 32% -2 50% +5 CZ 14% -2 31% -5 49% +7 MT 14% -1 33% 0 40% -6 LV 12% -1 27% -4 52% +6 LT 12% -3 36% -4 46% +8 As the results of 2004 and 2005 are compared more closely, the overall trend towards adopting the euro later is apparent. In general, the proportions in categories as soon as possible and after a certain time decrease whereas the shares in the column as late as possible increase. The greatest increase in the number of respondents wishing to adopt the euro as late as possible is found in Cyprus (+10 points), whereas the largest decrease in the proportion of citizens willing to have the euro as soon as possible is found in Slovenia (-6). Estonia is the only country where the respondents willing to have the euro as their national currency as soon as possible are more numerous than in 2004 (+4 points). No changes are detected regarding to the socio-demographic categories.

17 Introduction of the euro in the new member states - Wave 2 Report p Status of the euro as an international currency Q10. Do you think that the euro is an international currency like the dollar of the Yen? - % EU10 Yes No [DK/NA] 09/ % 20% 8% 09/ % 20% 7% 0% 20% 40% 60% 80% 100% Both in 2004 and 2005, a reasonable majority of the citizens in the EU10 assesses the euro to be an international currency like the US dollar or the Japanese Yen. A little over 7 in 10 respondents agree with the statement. The perception of the status of the euro remains stable during the preceding year. There are no substantial changes in the country by country results. The percentage of respondents stating yes varies between 77% in Slovenia and Cyprus, and 63% in Estonia. As in 2004, the strongest belief, 77% stating yes, in the euro is found in Slovenia and Cyprus, whereas the least confident respondents reside in Estonia (63%) and Latvia (66%). When looking at the changes in time at country level, the largest drop in the amount of respondents appreciating the euro as an international currency is detected, not surprisingly, in Lithuania, but also in Estonia (-7 points in both). The only country where the share of those replying yes increases, though very finely by 1 point, is Poland, whereas the support remains stable in Slovakia (74%) and the Czech Republic (71%). As already remarked in the 2004 report, the clearly positive perception of the euro as an international currency does not seem to lead to a greater support for the adoption of the currency. No changes are detected regarding to the socio-demographic categories.

18 Introduction of the euro in the new member states - Wave 2 Report p Expectations and fears regarding the adoption of the euro The second chapter deals with the opinions about the practical consequences and the expectations and fears related to the introduction process of the euro Practical consequences of the Euro changeover - A widespread agreement remains concerning the practical positive consequences of the introduction of the euro Q7. Do you think that the euro? - % EU10 Yes Diff No Diff d) Will be more convenient for those who travel in other countries of the euro-area? b) Will make purchasing in the euro-area countries easier? c) Will eliminate charges for changing from one currency to another inside euro-area countries? a) Will allow you to easily compare prices between euro-area countries? 92% 0 4% -1 80% -2 13% +1 74% -3 12% +1 70% -3 19% +1 In order to evaluate the EU10 citizens perception on the practical consequences of the euro, they were presented with four statements about the positive outcomes of the introduction of the euro. Like in 2004, a considerable majority of respondents agrees with all the statements. The most agreeable practical benefit from adopting the euro is seen to be the easier travelling inside the euro area. 92% agree with the statement in both years. In 2005, 80% of the respondents believe that the euro will make purchasing in other euro-area countries easier. This is 2 points less than a year before. 74% see the disappearance of the costs of currency exchange as a benefit whereas 70% appreciates the easier comparison of the prices between the euro-area countries. The support for the last two statements has diminished by 3 points since September At country level, Hungarians and Cypriots see the statements in the most positive light, whereas Lithuanians and Maltese are slightly less enthusiastic about the practical consequences of the introduction of the euro. This pattern is consistent with the 2004 results. All in all, there is a clear contradiction between the positively perceived practical consequences of the euro and the actual support of the adaptation process.

19 Introduction of the euro in the new member states - Wave 2 Report p Fears regarding the introduction of the euro - The respondents are continuously afraid of being cheated and abused in prices during the changeover Q8. Could you tell me for each of the following statements if you agree or disagree? - % EU10 Agree Diff Disagree Diff b) You are afraid of abuses and cheating on prices during the changeover e) The usage of the euro instead of the (NATIONAL CURRENCY) will probably make us feel more European than now? d) You think that adopting the euro will mean that (OUR COUNTRY) will lose a great deal of its identity a) The replacement of the (NATIONAL CURRENCY) by the euro will cause you personally a lot of inconvenience c) You think that adopting the euro will mean that (OUR COUNTRY) will lose control over its economic policy 75% +4 20% -3 43% -4 48% +3 39% 0 49% 0 39% +3 51% -3 35% +1 45% -4 To evaluate to what extent people have fears considering the introduction of the euro, the respondents were presented with four statements of possible threats following the adaptation of the euro, and one statement concerning the effect of the euro to the feeling of being European. In general, those disagreeing with the statements outnumber those agreeing with them in both years. The only statement having a considerable amount of respondents agreeing with it is the one concerning the possible abuses and cheating on prices during the changeover. Even though the overall averages in the EU10 remain reasonably stable, there are significant changes at the country level. The socio-demographic patterns concerning each statement remain the same as in 2004.

20 TP PT Flash Introduction of the euro in the new member states - Wave 2 Report p Abuses and cheating on prices during the changeover Q8b. You are afraid of abuses and cheating on prices during the changeover - % EU10 Agree Disagree [DK/NA] 09/ % 20% 5% 09/ % 23% 5% 0% 20% 40% 60% 80% 100% The fear of being cheated or abused on prices during the changeover increases slightly in one year. In 2005, three quarters of the citizens of the EU10 are afraid that the introduction of the euro in their country will lead to cheating and abuses in prices during the changeover period. The number of respondents agreeing with the statement is 4 points more than a year ago. At the same time, the share of those not having fear of this kind of conduct decreases 3 points form 23% to 20%. This statement stands clearly out from the four others having the most of respondents agreeing with it. This is understandable in the light of the debates taking place in the current euro zone countries concerning unjustified rises in the consumer prices. Also, a same kind of fear was detected in the surveys carried out in the present Euro countries before the euro was adopted as a national currency 1PT. Respondents in Poland (85%) are most afraid of being cheated in prices during the changeover, followed by the citizens of Malta (79%) and Cyprus (78%). Instead, the majority of Slovenians (55%) disagree with the statement, Slovenia being also the only country where there are more respondents trusting on fair pricing during the changeover than being afraid of the abuses. These results are consistent with the results of the 2004 survey. 1 EB 98/2

21 Introduction of the euro in the new member states - Wave 2 Report p. 20 Q8b. You are afraid of the abuses and cheating on prices during the changeover - % agree 09/ /2005 NMS 75% 71% PL MT CY LT SK LV CZ EE 85% 83% 79% 72% 78% 72% 78% 67% 75% 64% 69% 68% 66% 63% 66% 70% HU SI 34% 43% 53% 49% 0% 20% 40% 60% 80% 100% When observing the change over one year country by country, an already familiar tendency is found. In all the countries, except Estonia, the proportion of respondents agreeing with the statement of being afraid of abuses and cheating on prices during the changeover increases since The changes are, once again, most notable in Lithuania and Slovakia where the increase of the number of those agreeing with the statement is 11 points. Estonia is the only country where the proportion of those agreeing with the statement has decreased since 2004 (-4 points).

22 Introduction of the euro in the new member states - Wave 2 Report p Loss of national identity due to the adoption of the euro Q8d. You think that adopting the euro will mean that (OUR COUNTRY) will lose a great deal of its identity - % EU10 Agree Disagree [DK/NA] 09/ % 49% 11% 09/ % 49% 11% 0% 20% 40% 60% 80% 100% In both 2004 and 2005, a majority of respondents, 49%, does not believe that adopting the euro will cause their country to lose its identity. With a 10 % smaller share, 39% of respondents feel that this is the case. The perception on this question remains unchanged at the EU10 level. Once again, Hungarians and Slovenians are most likely to disagree with the statement. 65% of Hungarians and 52% of Slovenians believe that the introduction of the euro will not affect their national identities. This was also the case in 2004, the respective percentages being 67% and 57%. Most respondents feeling that the euro would expose their countries identity to a change are found, once more, in the Baltic countries. 59% of Latvians, 51% of Lithuanians, and 49% of Estonians fear that the introduction of the euro would cause their countries to lose a great deal of their national identities. The results are a straight variation of the results in 2004, the respective shares being 58%, 40% and 49%. As already discussed in sub-chapter 1.3.2, the question of national identity is very current in these countries, thus, the citizens of these countries are more likely to perceive threats in the introduction process of the euro.

23 Introduction of the euro in the new member states - Wave 2 Report p. 22 Q8d.You think that adopting the euro will mean that (OUR COUNTRY) will lose a great deal of its identity Agree Diff Disagree Diff NMS 39% 0 49% 0 HU 26% +2 65% -2 SI 38% +4 52% -5 PL 38% -3 52% +2 CY 42% +4 53% -2 MT 39% +3 49% -4 SK 39% +5 42% -1 CZ 45% 0 41% -2 EE 49% 0 33% -2 LT 51% % -8 LV 59% +1 24% -1 As the results are compared country by country, some changes can be defined even though the overall averages remain unchanged. When analysing the trend in the column agree, a slight tendency of increase in the amount of those agreeing with the statement concerning the loss of national identity can be depicted. This is the case in seven of the ten new Member States but since in the most populous country, Poland, the share decreases, the overall average remains the same as in On the other side of the table, the tendency is the opposite. In 9 countries out of 10, the proportion of the respondents disagreeing with the statement decreases slightly, Poland being again the only country going against the tendency. The most marked change is found in Lithuania. The share of those agreeing with the view that the euro will constitute a threat to the national identity increases by 11 points whereas the amount disagreeing with the statement goes down by 8 points.

24 Introduction of the euro in the new member states - Wave 2 Report p Inconvenience due to the introduction of the euro - A majority of citizens does not believe the changeover will cause them a lot of inconvenience Q8a. The replacement of the (NATIONAL CURRENCY) by the euro will cause you personally a lot of inconvenience - % EU10 Agree Disagree [DK/NA] 09/ % 51% 10% 09/ % 54% 10% 0% 20% 40% 60% 80% 100% Both in 2004 and 2005, over half of the citizens of the new Member States disagrees with the statement of euro causing them a lot of inconvenience, though there is a 3 points decrease in the number of respondents stating so. At the same time, the share of respondents feeling that the euro would cause them inconvenience increases slightly from 36% to 39%. Respondents in Slovenia (73%) and Hungary (57%) are the fewest to expect personal inconvenience with the introduction of the euro. This was also the case in 2004, the respective scores being 78% and 61%. On the contrary, the citizens of Lithuania, Malta and Cyprus agree more often with the statement. 53% of Lithuanians, 51% of Maltese, and 49% of Cypriots feel that the introduction of the euro would cause them personal inconvenience.

25 Introduction of the euro in the new member states - Wave 2 Report p. 24 Q8a. The replacement of the (NATIONAL CURRENCY) by the euro will cause you personally a lot of inconvenience - % country Agree Diff Disagree Diff NMS 39% +3 51% -3 SI 25% +7 73% -5 HU 29% +5 57% -4 PL 42% +2 53% -2 EE 42% +5 50% -1 CY 49% +9 48% -8 CZ 34% 0 46% -4 LV 41% 0 46% +1 SK 42% % -3 LT 53% % -9 MT 51% +2 35% -8 Once again, even the changes at the EU10 level are moderate, reasonable variation can be depicted in country by country analysis. The already familiar negative trend can be observed also with this statement. In 8 countries out of the ten new Member States, the share of respondents agreeing with the statement of the euro causing them personal inconvenience increases. Consequently, on the other side of the table, the percentage of respondents disagreeing with the statement decreases, with the exception of Latvia. Again, the largest changes in figures are depicted in Lithuania where the share of those feeling that the euro will cause them inconvenience goes up by 13 points, and following that, the share of those disagreeing with that diminishes by 9 points. The same trend is observed also in Cyprus, Slovakia, and Slovenia. The only country where the situation remains almost untouched is Latvia.

26 Introduction of the euro in the new member states - Wave 2 Report p Loss of control over the national economic policy - Only a minority believes that there will be a loss of control over the national economic policy Q8c. You think that adopting the euro will mean that (OUR COUNTRY) will lose control over its economic policy - % EU10 Agree Disagree [DK/NA] 09/ % 45% 20% 09/ % 49% 18% 0% 20% 40% 60% 80% 100% Consistently with the results of the 2004 survey, a majority of the respondents in the new Member States does not believe that the adoption of the euro would cause a loss of control over the national economic policy. There is a slight decrease during the year in the amount of respondents stating so, from 49% to 45%. The number of citizens fearing the loss of control remains stable at 34-35%. With this question, the reasonably high amounts of respondents answering do not know should be noted. This is most probably due to unfamiliarity with the subject. At country level, repeatedly, 63% of Hungarians and 52% of Slovenians do not fear the loss of control over economic policy, these countries being the most positive in both years covered. In 2004, the respective figures were 67% in Hungary and 56% in Slovenia. Latvians and Cypriots top the ranking in the other end. 51% of Latvians and 46% of Cypriots agree with the statement of the euro causing loss of control over the countries economic policy. In 2004, the countries with most of respondents agreeing with the statement were Latvia and Estonia, Cyprus following third. With this question, high levels of non-responses are found in Malta (28%), Slovakia (25%) and the Czech Republic (25%).

27 Introduction of the euro in the new member states - Wave 2 Report p. 26 Q8c. You think that adopting the euro will mean that (OUR COUNTRY) will lose control over its economic policy Agree Diff Disagree Diff NMS 35% +1 45% -4 HU 25% +2 63% -4 SI 33% +5 52% -4 CY 46% +5 43% -3 CZ 32% +2 44% -6 PL 35% -1 44% -4 SK 36% +4 39% 0 EE 42% -1 38% 0 LT 43% +7 38% -3 MT 37% +6 35% -10 LV 51% +6 26% -1 When analysing the trends at county by country level, some fine changes can be observed. Once again, the share of those agreeing with the statement, thus fearing the loss of control over economic policy, goes slightly up in 8 countries, whereas the share of those disagreeing diminishes also in 8 Member States. The changes are most distinct in Malta and Lithuania. In Malta, there is a 10 points decrease in the number of respondents not fearing the loss of control, whereas the share of those believing this is the case goes up by 6 points. In Lithuania, the share of respondents believing in the loss of control increases by 7 points, whereas the proportion of those stating the opposite diminishes 3 points. The same trend is depicted in most of the countries, except Slovakia and Estonia.

28 Introduction of the euro in the new member states - Wave 2 Report p Rise of the European identity? - Fewer respondents believe that the euro would make them feel more European - Q8e. The usage of the euro instead of the (NATIONAL CURRENCY) will probably make us feel more European than now - % EU10 Agree Disagree [DK/NA] 09/ % 48% 9% 09/ % 45% 8% 0% 20% 40% 60% 80% 100% The last statement here is indirectly parallel to the statement about the loss of national identity (Q8d.) dealing with the problematic balance between the European and national identities. In 2005, 43% of the citizens in the new Member States believe that the euro would contribute to the feeling of being European. This is 4 points less than in Contrary to the results a year before, those believing this is not the case outnumbers the first group by 5 points, with a 48% score. The citizens agreeing the most often with the statement reside in Slovenia (65%) and Malta (59%). This was also the case in 2004, with the respective figures of 70% and 59%. Instead, those not believing to feel more European are most likely found in Hungary (63%) and Estonia (54%), this result being consistent with the one obtained in 2004.

29 Introduction of the euro in the new member states - Wave 2 Report p. 28 Q8e. The usage of the euro instead of the (NATIONAL CURRENCY) will probably make us feel more European than now - % country Agree Diff Disagree Diff NMS 43% -4 48% +3 SI 65% -5 32% +6 MT 59% 0 31% 0 PL 47% -2 46% +1 CY 46% -9 51% +10 CZ 44% -9 41% +4 SK 43% +2 42% +2 LT 37% -6 51% +9 LV 36% -4 47% +6 EE 34% -4 54% +5 HU 31% -1 63% -1 Repeatedly, the most detectable changes are found at country level. The same trend that is found with all the statements is visible in the last one as well. In 8 countries out of 10, the share of respondents believing that the euro would make them feel more European drops, whereas the proportion of those not believing in this kind of change goes up, respectively, in eight countries. The most notable changes are found, not surprisingly, in Cyprus and Lithuania whereas the results remain fairly stable between the two studies in Malta, Poland, and Hungary. It is interesting to have a look at the results of this statement with the ones obtained with the statement on the loss of national identity, even if they are not directly comparable. While 39% of the respondents feel that the euro would cause their country to lose its identity, 48% do not believe that the euro would increase the feeling of being European. Instead, 43% feel that the euro would make them feel more European and 49% do not fear the loss of the national identity. Interpreting roughly, the respondents seem to be slightly more inclined to the European side.

30 Introduction of the euro in the new member states - Wave 2 Report p Consequences of the introduction of the euro on prices - One in two respondents still believes the introduction of the euro would increase inflation - Q9. Do you think the euro will help to maintain price stability or, on the contrary, increase inflation in (OUR COUNTRY)? - % EU10 Help maintain price stability Increase inflation [No impact] [DK/NA] 09/ % 48% 9% 18% 09/ % 48% 8% 18% 0% 20% 40% 60% 80% 100% The citizens of the EU10 are clearly more inclined to believe that the euro will increase the inflation than help to maintain the price stability in their country. Both in 2004 and 2005, about a half (48%) of the respondents think that the introduction of the euro in their country will increase the inflation. On the other hand, only approximately a quarter of respondents trust on the euro to maintain the price stability. Hungarians (39%) and Slovenians (36%) are the ones to believe most often in stable prices after the introduction of the euro, Hungary being the only country where the proportion of the respondents believing in price stability outnumbers those expecting an increase in the inflation. Also in 2004, the same countries had the highest proportion of respondents considering the price stability being an outcome of the introduction of the euro. On the contrary, in all the other countries, except Hungary, the respondents fear more that the euro will increase the inflation, this being the case especially in Lithuania (71%) and Cyprus (69%). Compared to the 2004 results, both countries have overtaken Malta (62% in 2004) that was the country with highest share of respondents expecting a rise in the inflation in 2004.

31 Introduction of the euro in the new member states - Wave 2 Report p. 30 Q9. Help to maintain price stability - % country 09/ /2005 NMS 24% 25% HU SI PL SK MT CZ EE LV CY LT 24% 23% 20% 21% 19% 22% 18% 18% 17% 17% 15% 14% 15% 20% 14% 20% 36% 37% 39% 45% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% When looking at the country by country results, the trends in time are more visible. In six countries out of ten, the percentage of respondents believing that the euro will help to maintain the price stability decreases compared to the 2004 results. In the Czech Republic and Estonia, the share remains the same as the year before, and a mild increase is found in Poland and Latvia. The highest drop is detected in Lithuania and Hungary, this being 6 points. Q9. Will increase inflation - % country 09/ /2005 NMS 48% 48% LT CY LV EE MT PL SI SK CZ HU 26% 27% 54% 59% 61% 55% 61% 54% 61% 62% 51% 54% 49% 44% 46% 45% 43% 47% 71% 69% 0% 10% 20% 30% 40% 50% 60% 70% 80% Logically, the trend is opposite amongst those who believe that the introduction of the euro will increase inflation. In six countries out of ten, the share of those fearing the inflation increases. The largest growth in the shares is detected in Lithuania and Cyprus, respectively 17 and 10 points increase. On the contrary, the four countries where the share slightly decreases are the Czech Republic (-4 points), Poland (-3 points), Hungary and Malta (-1 points each).

32 Introduction of the euro in the new member states - Wave 2 Report p Knowledge and experiences with the euro The third chapter handles the respondents actual knowledge on the euro and the familiarity with the euro currency Citizens knowledge about the introduction of the euro and the euro-zone The obligation to adopt the euro - Most citizens remain unaware about the fact that the adoption of the euro is obligatory Q11. Can (OUR COUNTRY) choose whether or not to introduce the euro? - % EU10 Yes No [DK/NA] 09/ % 30% 11% 09/ % 33% 10% 0% 20% 40% 60% 80% 100% A minority of citizens in the new Member States is aware of the fact that the euro will inevitably be the currency of their country within a few years. The level of knowledge can be even perceived to be slightly worse in 2005 than a year before. Only 30% of the respondents give the correct answer (-3 points compared to 2004) whereas 58% believe that their country can choose whether to adopt the euro of not. Respondents giving the correct answer do not outnumber those of giving the wrong answer in any of the countries, the citizens of the Czech Republic and Estonia being the closest. The Czech Republic (42%) continues to be the country with the largest amount of correct answers together with Estonia (42%). On the other hand, the highest rates of incorrect answers are obtained in Poland (67%), Slovenia (61%), and Lithuania (60%), Poland remaining the country with the weakest knowledge on this issue compared to the outcomes of the survey in 2004.

33 Introduction of the euro in the new member states - Wave 2 Report p. 32 Q11. Can (OUR COUNTRY) choose whether or not to introduce the euro? - % correct answers (NO) 09/ /2005 NMS 30% 33% CZ EE LV CY SK HU MT LT SI PL 23% 31% 32% 33% 32% 32% 33% 31% 31% 28% 42% 48% 42% 38% 41% 45% 39% 38% 41% 38% 0% 10% 20% 30% 40% 50% 60% When having a closer look at country by country results concerning the share of correct answers, some differences in time and between countries are found. In five countries, the level of knowledge concerning the obligatory nature of the adaptation of the euro decreases. This is the case especially in the Czech Republic (-6 points) and Poland (-5 points). Instead, the awareness increases in four countries, Cyprus being ahead with 8 points increase, followed by Hungary (+6 points) and Estonia (+4 points). In Slovenia, the level of knowledge remains stable. The reasons for the mild decrease in the level of knowledge can probably be found in the generally lower interest and support for the euro in 2005 than in Regarding the socio-demographic variables, the same patterns that were found in 2004 remain. The youngest respondents give the highest amount of incorrect answers. Surprisingly, this is also the case with those who have studied the longest time.