Consumer protection is no. 1

The National Council for Euro Adoption met under the chairmanship of Prime Minister Andrej Plenković on Thursday to present to the social partners and the public the bill to adopt euro as legal tender in Croatia and guidelines for the adjustment of the economy during the euro changeover process.

The bill has been sent to public consultation until 15 February and the final bill is expected to be sent to Parliament for a second reading in the second half of April.

It regulates the legal framework, the cash exchange, supplying all legal entities with euro, the loan and deposit conversion, and consumer protection from unjustified increases in prices.

Prices will be displayed in both kuna and euro as of 5 September to raise awareness of the euro even before its adoption, for which the target date has been set at 1 January 2023. The dual display of prices will continue throughout 2023.

Plenković said at today's meeting that technical preparations had begun for the changeover and that Croatia was in the final phase of implementing the obligations under the European Exchange Rate Mechanism II. He added that the intention was to meet the remaining obligations before the end of the first quarter of this year.

The prime minister recalled the benefits of the single currency for the Croatian economy and citizens, citing the disappearance of the currency risk and foreign exchange costs, lower interest rates, a boost to trade in goods and services, and the fact that 65 per cent of foreign tourists come from euro-area countries.

He also noted that the fact that a large proportion of savings and loans were in euro would also facilitate the changeover.  He said that euro deposits accounted for 76.2 per cent of all savings and time deposits and that 50.3 per cent of all loans were indexed to the euro.

Plenković said that consumer protection was the most important aspect of the euro adoption bill. "We should avoid any situations where the changeover process would be used to consumers' detriment," he said, adding that this was why there would be the dual display of prices.

Croatian National Bank (HNB) Governor Boris Vujčić said that the purpose of the bill was to ensure legal certainty in the euro adoption process and create conditions for the smooth, uninterrupted and efficient functioning of the economy.

He also stressed the importance of consumer protection. "As for deposits and loans with banks, citizens should not be concerned at all, because the conversion into euro will be done automatically, at no cost, according to the fixed conversion exchange rate," Vujčić said.

Text; Hina

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