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having regard to the Commission proposal for a Council decision on the adoption by Croatia of the euro on 1 January 2023 (COM(2022)0282),

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having regard to Article 140(2) of the Treaty on the Functioning of the European Union, (TFEU),

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having regard to the Commission Convergence Report 2022 and the European Central Bank Convergence Report of June 2022,

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having regard to its resolution of 1 June 2006 on the enlargement of the euro zone (1),

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having regard to its resolution of 20 June 2007 on improving the method for consulting Parliament in procedures relating to the enlargement of the euro area (2),

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having regard to Rule 106 of its Rules of Procedure,

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having regard to the report of the Committee on Economic and Monetary Affairs (A9-0187/2022),

A.

whereas Article 140 of the TFEU provides for the achievement of a high degree of sustainable convergence by reference to the fulfilment by each Member State of the following criteria: the achievement of a high degree of price stability; the sustainability of the government's financial position, the Member State not being subject to an excessive deficit procedure as described in Protocol No 12 annexed to the Treaties; the observance of the normal fluctuation margins provided for by the exchange-rate mechanism; and the durability of convergence achieved by the Member State and of the Member State’s participation in the exchange-rate mechanism of the European Monetary System being reflected in the long-term interest-rate levels (the ‘Maastricht criteria’);

B.

whereas Croatia has complied with the Maastricht criteria in accordance with Article 140 TFEU and Protocol No 13 on the convergence criteria annexed to the Treaties, and Croatia’s legislation has been evaluated by the Commission and the European Central Bank (ECB) as fully compatible with the requirements of the TFEU and the Statute of the European System of Central Banks and of the European Central Bank;

C.

whereas the TFEU calls for an examination of other factors relevant to economic integration and convergence to be taken into account in the assessment, including balance of payments developments and integration of product, labour and financial markets; whereas the Commission considers that Croatia fulfils the conditions for the adoption of the euro also on these additional criteria;

D.

whereas, based on common practice and as has been done several times in the past, for the purpose of assessing the price stability criterion, the Commission excludes from the best-performing countries those whose inflation rates could not be seen as a meaningful benchmark for other Member States, and has therefore excluded two Member States as the best performers from the assessment;

E.

whereas current circumstances, such as the increase in energy prices and the Russian illegal and unprovoked invasion of Ukraine had an impact on several indicators used in the convergence reports and would require an adequate reflection on their implementation; whereas adherence to those criteria contributes to the integration into the Economic and Monetary Union and to the Economic and Monetary Union’s long-term stability;

F.

whereas with the entry into force of the close cooperation framework on 1 October 2020, the ECB gained responsibility for directly supervising eight significant institutions and for overseeing 15 less significant institutions in Croatia;

G.

whereas Croatia committed to implement a number of measures following its entry in the Exchange Rate Mechanism (ERM II) in July 2020 in the following four areas: anti-money laundering, business environment, public sector governance and insolvency framework;

H.

whereas the Rapporteur visited Croatia to assess the readiness of the country to enter the euro area;

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