Złoty vs Euro - Poland's Worthwhile Defiance of European Monetary Unity

The Zloty Stays: Why Poland Has No Interest in Joining the Euro

There is a telling detail buried in Poland’s recent economic story. Bulgaria joined the EU in 2007, only three years later after Poland, and had recently joined the Eurozone this year as its 21st memberWarsaw’s response was not envy or urgency. It was something closer to quiet satisfaction. Poland had just crossed the threshold of a $1 trillion economy, ranked 20th in the world by IMF calculations, and its finance minister, Andrzej Domański, was telling the Financial Times that he saw “no strong reason to abandon our own currency.”

Poland, it seems, has decided the euro is someone else’s problem.

This is not a new position, and crucially it is not a partisan one. The reluctance to adopt the euro is one of the few areas where Poland’s deeply divided political landscape finds common ground. Right-wing governments have resisted it. Left-of-centre governments have resisted it. The arguments differ slightly in tone, but the conclusion is always the same: the zloty stays.

A Cross-Party Consensus

The conventional story about Poland and the euro is that it became a culture-war issue that the right-wing Law and Justice party (PiS) made the zloty a symbol of national sovereignty, and that resistance to the euro became coded as patriotism. There is truth in that. PiS did make it an important element of its political identity, and their finance minister Magdalena Rzeczkowska articulated the case in stark terms: “In today’s times, the most important thing is security, including the security of Polish families. Having our own currency provides greater economic and monetary security than joining the euro in a crisis situation.” She added that the shared currency “does not guarantee 100 per cent security, especially during high inflation,” and argued that the ability to manage the zloty independently including the option to devalue and thereby cheapen imports was precisely what made it valuable in turbulent times like covid or beginning of the war in Ukraine.

But Donald Tusk’s government, which came to power in October 2023 with an extremely pro EU point of view, has reached almost identical conclusions. Finance minister Andrzej Domański told the FT that the case for euro adoption had actually weakened as Poland outpaced most Eurozone economies. “Our economy is now doing clearly better than most of those that have the euro,” he said. “We have more and more data, research and arguments to keep the Polish zloty.” This from a government that ran on restoring Poland’s standing within European institutions, that reversed course on the rule-of-law disputes that had frozen EU funds, and that is genuinely committed to deeper EU integration in almost every other respect.

Tusk himself is the clearest illustration of how the position has shifted. In his first government in 2008 he called for Poland to adopt the euro. That idea was quietly dropped after the euro debt crisis, and he has not revived it since returning to office. The man who wanted Poland in the Eurozone, now leads a government without any motivation to join the eurozone as independence is highly valued by Poland.

The Zloty’s Practical Advantages

The core argument for keeping the zloty is about flexibility the ability to use monetary policy as a shock absorber when things go wrong.

When a country joins the Eurozone, it hands its interest rate policy to the European Central Bank in Frankfurt. The ECB sets rates for the entire currency area, which means it is necessarily setting them for an average of very different economies. What is appropriate for Germany or France may be wrong for Poland, and Poland has no recourse if that happens. A country with its own currency can cut rates to stimulate a slowing economy, raise them to cool inflation, or allow the exchange rate to adjust to absorb external shocks. A Eurozone member cannot do any of these things unilaterally.

Former Finance Minister Rzeczkowska made this point explicitly: the ability to manage the zloty “gives the possibility of lowering the value of imported goods, for example oil.” In plain terms, if global energy prices spike, a country with its own currency can allow it to weaken slightly, spreading the adjustment more broadly across the economy, rather than taking the full shock in prices and wages. This is not a theoretical advantage it is one Poland has used in practice, and it is one that disappears entirely inside the Eurozone.

The zloty has also strengthened considerably since Tusk won the 2023 election, moving from around 4.7 zloty per euro to roughly 4.3. A stronger currency reduces import costs and can help control inflation again, an adjustment that happened because markets responded to Poland’s improved fiscal and institutional politics, and that would not have been possible inside the euro.

The Economic Case for Staying Out

Beyond monetary flexibility, Poland’s current economic position makes the euro look less attractive than it did fifteen years ago.

Poland became a $1 trillion economy last year, ranking as the world’s 20th largest. The OECD forecasts growth of 3.4 per cent in 2025 the fastest pace among EU countries covered in its December report. For context, the Eurozone as a whole has been struggling with near-stagnation, Germany contracted for two consecutive years, and France has been wrestling with fiscal problems serious enough to unsettle bond markets. The argument that Poland needs the euro’s stability looks harder to make when the countries inside it are growing more slowly than the country outside. Why Poland would like to join a zone full of stagnation when with zloty they are currently on a good path to become the fastest growing economy in the EU?

Domański acknowledged that he had worried two years earlier about Poland being left behind in a “two-tier EU” a core Eurozone inner circle and a peripheral non-euro outer ring. He no longer worries about this. “Today Poland is clearly in the top economic tier,” he told the Financial Times, “and I see no strong reason to abandon our own currency.” Instead of seeking Eurozone membership, Warsaw is pursuing a seat at the G20, reflecting a self-image as a major economy rather than an EU periphery country anxious for the credibility boost of the common currency. Warsaw is invited by the US president’s Donald Trump administration to join the G20 meeting in Miami in the role of the observer.

There is also a practical obstacle: Poland’s budget deficit. The European Commission forecasts it will narrow to around 6.3 per cent of GDP in 2026, down from about 6.8 per cent the year before but still more than double the 3 per cent Maastricht threshold that countries must meet to qualify for euro membership. Poland is not close to qualifying, and the deficit is partly a consequence of very high defence spending, which Warsaw is unlikely to cut given the security situation on its borders. The legal obligation to eventually adopt the euro, which all non-Eurozone EU members carry, is in practice entirely theoretical until these numbers change. Additionally, it is worth to outline Domański’s statement that decision to join eurozone is at the end political.

Whatever the government’s economic reasoning, the political arithmetic is also simple: most Polish voters do not want the euro. Opinion polls have consistently shown a majority opposed to adoption since the financial crisis.

by Wojciech Sowa