Poland still wants euro, central bank head says

AP News
Posted: Oct 21, 2011 7:23 AM
Poland still wants euro, central bank head says

The euro has proven "a great success" despite the debt problems gripping some countries that use it, the outgoing head of the European Central Bank said Friday. A top Polish financial official, meanwhile, insisted his country remains keen on adopting the currency.

The optimism expressed by ECB head Jean-Claude Trichet and Poland's central bank chief Marek Belka comes amid growing concern about the viability of the euro due to the financial problems gripping Greece, Italy and Spain and other European nations.

"The euro as a currency is a great success indeed," Trichet said during a conference in Warsaw organized by the National Bank of Poland. He said the currency remains credible because "it is backed by remarkable fundamentals."

Trichet, who is retiring, has often argued that what Europe is seeing is not a crisis of the euro currency, but one of government finances. He repeated that view in Warsaw, saying that times are difficult and that governments must work hard to get their finances in order.

He also defended a new bailout for Greece that requires more restructuring, calling it "the best way to get sustainable growth and job creation."

Belka said that although it is impossible to ignore the crisis in Europe, "Poland remains strongly committed to joining the euro area." But he added that "it wouldn't be wise to determine a specific date" at this point, though Poland must continue to prepare itself for the eventual change.

Several years ago Poland had set 2012 as its target date for switching its zloty to the euro, but then began speaking of 2015 as troubles in Greece and elsewhere deepened. More recently, however, officials says it's impossible to set a specific date and that they want to see stability return first.

Poland also does not yet meet the criteria for joining, with its high budget deficit a key problem.

Belka said a recent proposal floated by Russian Prime Minister Vladimir Putin for a "Eurasian Union" of former Soviet nations attests to the success of the 27-member European Union, which is now an "example" for other parts of the world.

"It shows how contagious the idea of the European Union is," Belka said. "We should be satisfied and proud."