1. A Disparity Between Economic Alignment and Nominal Convergence
Zdeněk Tůma
Czech National Bank
13th Dubrovnik Economic Conference
June 29, 2007

2. EU Entry Entry to the EU is linked to many institutional changes
These, however, were introduced well in advance of entry itself
As a consequence, no rapid changes in macroeconomic development were expected in connection with the entry date
Nevertheless, export growth, for instance, increased substantially

3. EU Entry

4. Economic Alignment
Despite these positive effects, the level of synchronization of the business cycle and economic shocks between the newcomers and the EU core remains relatively weak
The CNB prepares an analysis of economic alignment with the eurozone on a yearly basis (available at

5. Economic Alignment Correlation of real GDP growth
(2 methods; period ; source: Eurostat, calculation CNB)

6. Economic Alignment
Correlation of demand and supply shocks with the euro area
(source: CNB calculation)
demand shocks supply shocks

7. Nominal Convergence
In contrast to economic alignment, the process of nominal convergence is going well

8. Three Years On … Positive effects on economic development
Level of economic alignment remains weak
Nominal convergence (inflation and nominal interest rate) has occurred
Is this enough to enter EMU?

9. Thank you for your attention.