Croatia and the euro
Croatia's currency, the kuna, has used the euro (and prior to that one of the euro's major predecessors, the German mark or Deutschmark) as its main reference since its creation in 1994, and a long-held policy of the Croatian National Bank has been to keep the kuna's exchange rate with the euro within a relatively stable range. Croatia's EU membership obliges it to introduce the euro once it fulfils the euro convergence criteria. Prior to Croatian entry to the EU on 1 July 2013, Boris Vujčić, governor of the Croatian National  Bank, stated that he would like the kuna to be replaced by the euro as soon as possible after accession. This must be at least two years after Croatia joins the ERM II (in addition to it meeting other criteria). Croatia joined ERM II on 10 July 2020. The central rate of the kuna was set at 1 euro = 7.53450 kuna. Prime Minister Andrej Plenković stated in November 2020 that Croatia intends to adopt the euro on 1 January 2023 and the Croatian government adopted an action plan for euro adoption later in December. Many small businesses in Croatia  had debts denominated in euros before EU accession. Croatians already use the euro for most savings and many informal transactions. Real estate, motor vehicle and accommodation prices are mostly quoted in euros. Convergence status. In its first assessment under the convergence criteria in May 2014, the country satisfied the inflation and interest rate criteria, but did not satisfy the public finances, ERM membership and legislation compatibility criteria. Subsequent convergence reports published in June 2016, May 2018 and June 2020 came to the same conclusions. Target date for euro adoption. Croatia's EU membership obliges it to join the eurozone once  it fulfils the euro convergence criteria. Prior to Croatian entry to the EU on 1 July 2013, Boris Vujčić, governor of the Croatian National Bank, stated that he would like the kuna to be replaced by the euro as soon as possible after accession. This must be at least two years after Croatia joins the ERM II (in addition to it meeting other criteria). The Croatian National Bank had anticipated euro adoption within two or three years of EU entry. However, the EU's response to the financial crises in eurozone delayed Croatia's adoption of the euro. The country 's own contracting economy also posed a challenge to its meeting of the convergence criteria. While keen on euro adoption, one month before Croatia's EU entry governor Vujčić stated "...we have no date [to join the single currency] in mind at the moment". The European Central Bank was expecting Croatia to be approved for ERM II membership in 2016 at the earliest, with euro adoption in 2019. In April 2015, President Kolinda Grabar-Kitarović stated in a Bloomberg interview that she was "confident that Croatia would introduce the euro by 2020", although the then-Prime Minister Zoran Milanović subsequently  refused to commit to such timeline for the euro adoption In November 2017, Prime Minister Andrej Plenković said that Croatia is aiming to join ERM II by 2020 and to introduce the euro initially by 2025. Jean-Claude Juncker, President of the European Commission, stated in June 2019 that "Croatia is ready to join the ERM-2". A letter of intent of joining the ERM II mechanism was sent on 5 July 2019 to the ECB, signed by Minister of Finance Zdravko Marić, and the governor of the Croatian National Bank Boris Vujčić. The letter marks the first formal step towards  the adoption of the euro. Croatia committed to joining the Banking union of the European Union as part of its efforts to join ERM II. On 23 November 2019, European Commissioner Valdis Dombrovskis said that Croatia could join ERM II in the second half of 2020. Croatia joined ERM II on 10 July 2020. The central rate of the kuna was set at 1 euro = 7.53450 kuna. The earliest date for euro adoption, which requires two years of ERM participation, is 10 July 2022. In June 2021, Prime Minister Plenković said the government's ambition is to join the  eurozone on 1 January 2023. On 21 July, Plenković stated that national identifying marks on the Croatian euro coins would be the Croatian checkerboard, the map of Croatia, a marten, Nikola Tesla and the Glagolitic script. In September, speaking at the 11th meeting of the National Council for the Introduction of the Euro as Croatia's official currency, Plenković said Croatia had the full support of the European Commission and the European Central Bank to join the euro area. He restated his confidence Croatia would be ready to enter the euro area on 1 January 2023. In September 2021, following  the meeting of the Eurogroup in Slovenia, Croatia signed an official agreement (a Memorandum of Understanding) with the European Commission and eurozone member states on practical steps for the actual minting of Croatian euro coins. On 7 December 2021, Croatia and the European Commission signed a Partnership Agreement for the organization of information and communication campaigns, concerning the changeover from the kuna to the euro in Croatia. On December 14th, 2021, Prime Minister Plenkovic stated that he expected to have a final decision from the EU, on Croatia's accession to the Schengen and euro areas, in 2022. Also in  December 2021, Finance Minister Zdravko Marić announced that the bill on introducing the euro currency in Croatia was being drafted and could be outlined in mid-January, with its final adaption expected in April 2022. The formal announcement of accession to the euro area is expected mid-2022. He further stated, "As of 1 January 2023, we will change over to the euro overnight and then have another two weeks for both currencies in circulation and citizens will be able to continue to pay in kuna but after that payments will be in euro. The dual prices will remain for at  least one year". In January 2022, Croatian Prime Minister Andrej Plenković has announced that from September 5, prices will be displayed in both kunas and euros in the country, and through the whole of 2023. In 2023, everyone will be able to exchange kunas for euros free of charge in banks, in the Croatian Post offices, and in Financial services and payment systems branches. The European Commission does its assessment of Croatia's progress in May 2022. The official decision for euro adoption is done by the EU's ECOFIN council and is expected to be as soon as July  2022. Croatia joined ERM II on 10 July 2020, subsequently this decision must be at least two years after Croatia joined the ERM II. Choosing the national side of the Croatian euro coins. On 4 February 2022 the Government of Croatia presented the designs for the national side of the future Croatian euro coins, which were chosen in an open contest by the Council of the Croatian National Bank. For the €2 coin, a design with the geographical map of Croatia by designer Ivan Šivak was chosen. The edge inscription uses lyrics from the pastoral play "Dubravka" from 1628 . For the €1 coin, a design with a marten standing on a branch, an animal after which the Croatian currency at the time was named, by designer Stjepan Pranjković was chosen. For the 10c, 20c and 50c coins, a design with Nikola Tesla, born in Smiljan (Austrian Empire, present day Croatia), by designer Ivica Družak was chosen. Finally, for 1c, 2c and 5c coins, a design with ligature bound letters Ⱈ (H) and Ⱃ (R) in Glagolitic script by designer Maja Škripelj was chosen. Each author received 70,000 kn (approx. €9,300) for their chosen design. After suspicions arose  online that the design of the €1 coin used an unlicensed image of a marten on a branch by the Scottish photographer Iain Leach, the designer of the €1 coin, Stjepan Pranjković withdrew his design on 7 February 2022. On 8 February 2022, the Croatian National Bank announced they will hold a new competition for the design of the Croatian €1 coin with a marten motif. Cost of the change from kuna to euro. The Croatian Ministry of Finance estimated the cost of changing from using the kuna to the euro to be around 2 billion kuna . Government analysis indicates that most of the cost would be on the loss of the conversion business by the banking system, which is expected to lead to a rise in other banking fees. There is a possibility of a general price increase for consumers, with a simultaneous general currency conversion risk for most debtors.