cross-posted from: https://sh.itjust.works/post/37536459
Exclusive: Ukraine considers shift from dollar to euro amid geopolitical realignments
Ukraine is starting to consider a shift away from the U.S. dollar, possibly linking its currency more closely to the euro amid the splintering of global trade and its growing ties to Europe, Central Bank Governor Andriy Pyshnyi told Reuters.
Potential accession to the European Union, a “strengthening of the EU’s role in ensuring our defense capabilities, greater volatility in global markets, and the probability of global-trade fragmentation,” are forcing the central bank to review whether the euro should be the reference currency for Ukraine’s hryvnia instead of the dollar, Pyshnyi said in emailed remarks.
For Ukraine, that just makes sense. Most of Ukraines trade is with countries using the Euro. They are in Europe and actually border the Eurozone with Slovakia. Romania is working hard on adopting the Euro too. Obviously Poland and Hungary also have to adopt the Euro at some point, as they are EU members without an opt out. Ukraine wants to join the EU, so it has to also agree to adopting the Euro at some point.
If you live in a middle of nowhere country the dollar makes sense. Sure the US has some issues, but there is no reason the EU couldn’t have similar or worse issues in the future and so you can debate what the future will really be. However Ukraine isn’t middle of nowhere, it is middle of Europe and the Euro is too important to that part of the world to ignore.
While I have not lived or visited Poland, I do have relatives there. From their words Polish society isn’t exactly enthusiastic about adopting the euro.
Latest pole was 57% for the Euro and 41% against with 2% undecided. To be fair that is the EU asking and it might be different depending on the pollster and the poll is a year old, but they are certainly not fully against it, so it will never happen.
It’s become a lot more popular since covid, it was unpopular during the greek crisis and there was some concern when the dollar was stronger (and Germany lost Russian gas) but since Trump people are looking hard at the value of European stability and the euro is pleasantly boring right now.
With the return of Trump, I could see the dynamic shifting a lot.
I think California should also do this.
