No easy eurozone entry
Speaking at an economic conference in Warsaw last week, the European Central Bank President, Jean-Claude Trichet, said that the reform of the Growth and Stability Pact would not make it easier for new EU members to enter the eurozone.
"I think that the new situation has not changed as far as entry of the new countries [is concerned]," he said, adding that countries wanting to join the euro should concentrate on curbing budget deficits, which would also help them better absorb EU funds.
The German Bundesbank vice-president Juergen Stark has also waded into the debate.
In an interview with the Handelsblatt newspaper, he said: "The convergence criteria for adoption of the euro remain unchanged, especially in terms of the three-percent deficit limit.
"Uncertainty on this point has arisen through the weakening of the Stability and Growth Pact, but there is definitely a consensus in the EU that new member states must have equality of treatment with the original members when it comes to adopting the euro. It must not under any circumstances be easier for them to qualify for the euro than it was for the founding members."
EU leaders last month gave governments more time to get their budgets in order if they broke the three-percent limit. They also said countries where pension reforms raised budget deficits would be given five years to absorb the costs without punishment.
The Polish Central Bank Governor, Leszek Balcerowicz, has other ideas, however. He said that the loosening of the pact might help Poland adopt the euro.
"It makes [euro adoption] easier [but] these changes could be risky because they would be less effective in preventing irresponsible fiscal policy," he said.
The European Central Bank has criticized the changes to the pact and consistently warned against new member states rushing to join the euro before they have completed budgetary and structural reforms. (Reuters)
"I think that the new situation has not changed as far as entry of the new countries [is concerned]," he said, adding that countries wanting to join the euro should concentrate on curbing budget deficits, which would also help them better absorb EU funds.
The German Bundesbank vice-president Juergen Stark has also waded into the debate.
In an interview with the Handelsblatt newspaper, he said: "The convergence criteria for adoption of the euro remain unchanged, especially in terms of the three-percent deficit limit.
"Uncertainty on this point has arisen through the weakening of the Stability and Growth Pact, but there is definitely a consensus in the EU that new member states must have equality of treatment with the original members when it comes to adopting the euro. It must not under any circumstances be easier for them to qualify for the euro than it was for the founding members."
EU leaders last month gave governments more time to get their budgets in order if they broke the three-percent limit. They also said countries where pension reforms raised budget deficits would be given five years to absorb the costs without punishment.
The Polish Central Bank Governor, Leszek Balcerowicz, has other ideas, however. He said that the loosening of the pact might help Poland adopt the euro.
"It makes [euro adoption] easier [but] these changes could be risky because they would be less effective in preventing irresponsible fiscal policy," he said.
The European Central Bank has criticized the changes to the pact and consistently warned against new member states rushing to join the euro before they have completed budgetary and structural reforms. (Reuters)
