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Velimir Šonje
Episode · #5

A VISTA Velimir Šonje

Guest Velimir ŠonjeHosted by Gordana GelenčerMay 3, 2026
About this episode
What you'll hear in this conversation

Can a book titled 'Euro in Croatia: For and Against' truly be written by someone who is a known proponent of euro adoption? Velimir Šonje, a consultant, director of Arhiv Analitike, and editor of Ekonomski lab, has done exactly that. He unpacks not just the arguments for joining the euro area, but also its internal political-economic tensions, its past errors, and the specific challenges of its governance, especially for smaller nations. This conversation is less about whether Croatia should adopt the euro, and more about how the euro area itself has evolved, what lessons its crises have taught, and the unique economic mechanisms that make it a distinct proposition for small, open economies. You will walk away with a clearer understanding of the euro area's operational realities, beyond the headlines.

Insights from the conversation
What to take from this episode
01
Even a book titled 'Euro in Croatia: For and Against' and written by a known proponent of the euro, like Velimir Šonje's, dedicates significant space to the euro area's internal political-economic tensions and past errors. The goal isn't to discourage, but to ensure that anyone entering a system does so with a clear understanding of its complexities, not just its benefits.
02
The euro area Croatia enters today is fundamentally different from the one established in 1999 or even 2007 when Slovenia joined. As Velimir Šonje explains, the Greek crisis, though painful, forced the bloc to address serious 'design flaws' in its original structure. The lesson: a system's true stability is often forged through crisis, not in its initial design.
03
For large national economies like the US or Japan, monetary policy offers significant maneuvering room; exchange rate changes don't immediately ripple through the entire domestic market. But for small, open economies, Velimir Šonje points out that every exchange rate shift triggers a cascade of repercussions, from consumer behavior to investment decisions and debt. The true benefit of euro adoption for smaller states isn't just stability, but escaping the constant, disruptive feedback loops of an independent currency.
04
Before the Greek crisis, a 'dogma' existed: no euro area member could, colloquially speaking, go bankrupt. The crisis shattered this unspoken rule, forcing the bloc to spend two and a half years creating the European Stability Mechanism and a 'macroeconomic adjustment program.' Velimir Šonje notes that while the initial response was slow and painful, the system now has a 'recipe' for managing similar situations. The hard-won lesson: crisis management tools are rarely built preemptively; they are forged in the fire of the first major test.
05
While nine EU countries remain outside the euro area, Velimir Šonje argues most are not true counter-examples. Denmark and Sweden, for instance, largely mirror ECB interest rate policy, with their own currencies serving more as a symbol than a tool for independent monetary action. The exceptions are often driven by political, not economic, motives. The lesson: a country can technically retain its currency while functionally operating as if it were already in the euro area, nullifying the perceived benefit of independence.
06
The host highlights Poland as a unique case among non-euro countries, having explicitly used its exchange rate as an instrument to navigate the crisis. This suggests that while most small, open economies benefit from euro adoption, a large enough domestic market and sufficient economic insulation can, in specific circumstances, allow for effective independent monetary policy. The lesson: every country's monetary policy choice is unique, and what works for Poland may not apply to countries with different economic structures.
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