By contrast, Romania pursues both a floating exchange rate and a direct inflation targeting strategy, the same as Hungary, Poland and the Czech Republic and, therefore, the approach is different, the changeover to the euro being more complex in this context. This is by no means to say that Romania is sceptical about euro adoption, but merely that it needs a comprehensive view, meant to ensure an adequate timing of this moment and a successful entry into the euro area. While we are on the subject, it cannot be overlooked either that the New Member States having adopted the euro – Latvia, Lithuania, Estonia, Slovakia, Slovenia – are relatively small countries, with a different level of real convergence. Referring to countries that are currently in the process of adopting the euro, I myself am among those who stress the need for sustainable convergence, being aware that, in order to reap the benefits of euro area accession, several essential prerequisites have to be cumulatively met. The fact that nominal convergence criteria need to be fulfilled in a lasting – not accidental, forced or temporary – manner is just one aspect. Actually, the durability of convergence has been set forth in the Maastricht Treaty itself (“high degree of sustainable convergence” is the exact wording), but this “detail” has been taken too lightly for a while. Moreover, now it is obvious for everybody that real convergence is also essential for the sustainability of the entire process of euro adoption.
Construction activities over the next few years In line with other economic activity, construction activity declined slightly last year, although this was estimated to be a temporary phenomenon. Large resources have been allocated for infrastructure measures and for the development of the third generation of mobile telephony, which is estimated to lead to increased activity in future. There are numerous indications that residential construction will continue to increase, albeit from a low starting level. The continuing positive development of households’ disposable incomes should lead to an increase in new building and renovation of housing. Subsidies for building rental apartment blocks, support for student accommodation and ecological construction are also expected to stimulate investment in housing. Seen in a slightly longer term perspective, the low rate of new building is insufficient to meet the demand. A shift in the age structure will probably lead to an increase in housing investment as a percentage of GDP. However, even here prices and wages comprise a problem for the industry. The preliminary results show that construction workers received wage increases in excess of 5 per cent last year, while productivity only amounted to 1.4 per cent and unemployment among construction workers was almost 10 per cent. Unemployment in the construction industry varies geographically, however, with a rate of under 3 per cent in Stockholm and over 19 per cent in, for instance, the Gävleborg and Norrbotten regions. Relative productivity in the construction sector appears to be declining. The gap between the percentage employed and the percentage of GDP is increasing.