After Friday’s decision taken by the European council for Slovenia to join the euro as from next January, the countries next in line are considered to be just Malta and Cyprus, which both aim to join in 2008.

The three Baltic States, two of whom originally wanted to join with Slovenia (Lithuania) and with Malta (Estonia) have now changed their target year to 2010 due to their present high inflation.

Lithuania, in particular, tried till the very last minute of the Brussels summit to convince the EU leaders to allow it to join next year. It was supported by other new member States such as Poland, the Czech Republic, Hungary, Slovakia and Estonia in its endeavours but was persuaded by the Austrian Chancellor and Luxembourg’s Prime Minister to desist. It is still not clear if it can possibly join in 2008, as the rejection of a bid can put an applicant back by more than a year.

Countries who want to join the euro have to satisfy five macro-economic criteria listed by the Maastricht Treaty, which aim to guarantee stability: control over public finances (deficit and debt), and over inflation, limited range of exchange and interest rates.

Maltese government sources told this newspaper that of all the criteria it is the inflation rate, which can become a problem in the coming months. Maltese inflation is perceived as being very close to the borderline between what is accepted and what is not, and a further acceleration can put Malta in the same situation that Lithuania has found itself in.

Estonia, which originally wanted to join in 2008, last May indicated 2010 as the more likely date due to inflation. The Czech Republic and Hungary wanted to join in 2010 but Hungary has a huge budget deficit.

Poland may join in 2012 but the Polish authorities say they will begin to think about a date only in 2009.