The Croatian government has taken up arms against companies and institutions that want to profit from the changeover to the euro. Companies are furious over fines running into thousands of dollars, pointing to inflation as the culprit.
This year Croatia said goodbye to its own currency, the kuna, and became the youngest member of the eurozone. In addition to the already high inflation, the price level rose immediately after the introduction of the euro, as prices were rounded up.
When the European currency was introduced in Croatia – as in previous euro countries – there was a fear that ordinary citizens would lose out. That’s why the government wants to crack down on companies that abuse the monetary transition phase for their own gain.
Zero tolerance
Companies risk fines, taxes and rebates on energy offsets if they don’t bring their prices back to pre-euro levels. “Price increases, which overshadow the introduction of the euro and contribute to inflation, are not fair and will not be tolerated,” Prime Minister Andrej Plenkovic said. In the meantime, fines of 234 thousand euros have been imposed.
Macroeconomist Edin Mujagic has previously said that Croatia’s entry into the euro “wasn’t a choice at all”. “As soon as you have become a member of the EU and meet five criteria, you must introduce the euro.” Mujagic thinks the euro will be good for the Balkan country: ‘Croatia is a small country, so it’s very good for that country to join a bigger whole.’
Source: BNR
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