By Bruno Waterfield - 27th June 2004
Three new-EU countries have taken the first step to joining the euro by signing up to tight fiscal rules, a move welcomed in Brussels.
Estonia, Lithuania and Slovenia have fixed the value of domestic currencies against Europe’s single currency heralding possible entry to the euro club.
But membership of the exchange rate mechanism (ERM) will tie Tallinn, Vilnius and Ljubljana into tough EU fiscal rules - and making the grade is a precondition.
“The decision is accompanied by a commitment by these countries to pursue sound fiscal policies, effective financial supervision, appropriate wage policies and structural reforms,” said a Brussels spokesman.
"It is expected that some more new member states will ask to join either later this year or the beginning of next year."
The European Commission is currently rethinking how to enforce European public spending rules designed to give stability to the euro.
Europe’s Stability and Growth Pact sets out national budget rules engineered to underpin the single currency used in 12 economies.
The rules have taken a battering with key European governments – led by Germany and France – serial offenders against a public debt ceiling fixed at three per cent of GDP.
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