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The Week in Germany: Current Affairs

June 29, 2007

EU Leaders Welcome Malta and Cyprus into the Eurozone, Croatia on track for EU Accession

On January 1, 2008, the Mediterranean island nations of Malta and Cyprus will become the latest EU member states to get the Euro, the EU currency.

The European Central Bank determined in May that the nations had undertaken the necessary belt-tightening to meet the convergence criteria set forth in the Treaty of Maastricht. The criteria set benchmarks for inflation, government debt, interest rates, and other indicators of economic stability and discipline.

Cyprus had hoped to join the Eurozone by 2007, but its large deficit held it back. The Cypriot government launched an austerity drive to push from 6.3 percent in 2003 to the deficit to under two percent this year. Cypriot President Tassos Papadopoulos praised the sacrifices his people made to reign in Cyprus' budget deficit, public deficit and inflation, particularly unions that accepted a two-year pay freeze.

Final approval will come from EU finance ministers on July 10, bringing the number of countries using the currency to 15.

Croatia on Track for EU Accession

Accession talks with Croatia were opened on six further policy chapters on June 26, including the right of establishment and freedom to provide services, company law, financial services, information society and media, statistics and financial control.

Heading the EU delegation at the talks was Frank-Walter Steinmeier, Germany's Federal Foreign Minister and current President of the Council of Foreign Ministers, who said in Brussels that Croatia was “well on its way” to EU membership.

With the talks in Brussels, Croatia has now begun negotiations on 12 of the 35 chapters of the EU accession process.

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