The creation of the Euro required that states joining the single currency had to have their economies broadly aligned before being able to become a member. Any new accession states are expected to join the single currency when economic factors permit. The UK and Denmark negotiated opt-outs at the outset of the Euro project (but neither rules out the possibility of eventually joining the single currency) whilst Sweden and four other recent EU accession states still have not met the convergence criteria needed to join the currency.
Joining the Euro was intended to be an irrevocable step, so there is no clear, existing mechanism for a nation to leave it. However, as Greece is discovering, you must adhere (or should we say strive to adhere?) to the convergence criteria to remain a member. Two key components of the convergence requirements that got badly bent out of shape as a result of the Global Financial Crisis and its little brother, the European Sovereign Debt Crisis, were that public debt should be constrained to a maximum of 60% of GDP and that the current account deficit should not exceed 3% of GDP.
Like a number of its partners, France found itself falling foul of the convergence criteria in the aftermath of the turmoil caused by the two crises. By 2013, France’s debt to GDP ratio had climbed to 93.5% (even Germany, the powerhouse of the Eurozone saw its debt to GDP ratio hit 78.4%). The French deficit stands at 4.4% (having peaked at 7.5%). The administration of Francois Hollande swept Nikolas Sarkozy to power on a promise that they could right the economy without the need for further painful austerity measures (always a vote-winning proposition), but the situation has not improved as they hoped. France has been granted a further 2 year prolongation until 2017 to get its deficit back to the 3% level (or below). France had expected to meet the target this year and this is the third time that the country has been granted an extension (without penalty). Former EU economy commissioner Olli Rehn warned that failure to punish France could undermine the credibility of the Eurozone. However, most people recognise that the EU and much of the rest of the world is still dealing with aftershocks from the greatest economic crisis in living memory, so his warning will fall on deaf ears.