Members of the Croatian parliament have overwhelmingly voted in favor of replacing the national currency – Croatian Kuna with the official currency of the Eurozone.
Croatian government officials say that adoption of the Euro should remove currency risk, reduce interest rates, improve the country’s credit rating and pave the way for more investment.
Croatia’s major challenge, since joining the European Union in 2013, has been controlling inflation and budget spending, to meet the macroeconomic criteria for eurozone membership.
Croatia remains among the weaker economies of the European Union EU), partly due to the enduring legacy of the 1990s war.
Croatian economy relies heavily on tourism revenue, drawing several million European and other global visitors each year.
Under the newly approved law, all prices in Croatia will be displayed in both, Croatian Kuna and Euro from September 2022, with both currencies accepted equally throughout next year.
The euro is the official currency of 19 of the 27 member states of the European Union. This group of states is known as the eurozone or, officially, the euro area, and includes about 343 million citizens as of 2019. The euro is divided into 100 cents.
The currency is also used officially by the institutions of the European Union, by four European microstates that are not EU members, the British Overseas Territory of Akrotiri and Dhekelia, as well as unilaterally by Montenegro and Kosovo.
Outside Europe, a number of special territories of EU members also use the euro as their currency. Additionally, over 200 million people worldwide use currencies pegged to the euro.
As of 2013, the euro is the second-largest reserve currency as well as the second-most traded currency in the world after the United States dollar.
As of December 2019, with more than €1.3 trillion in circulation, the euro has one of the highest combined values of banknotes and coins in circulation in the world.