Thursday, 27 June 2019

Zeman for Czechs to adopt euro after Greece leaves euro zone

ČTK |
16 December 2015

Bratislava, Dec 15 (CTK) - The Czech Republic should introduce the euro on the first day after Greece´s departure from the euro zone, if possible, Czech President Milos Zeman told the TASR Slovak news agency in an interview that the Smer.sk server released on Tuesday.

Zeman said he envies Slovakia its euro zone membership.

"My only apprehension about the adoption of the euro amid the present stabilisation mechanism is that Czech taxpayers would have to cover the Greek debts. I was very disappointed by the outcome of the [summer] negotiations that were close to ´Grexit´ but finally resulted in Greece´s remaining in the euro zone," Zeman said.

"I have been told that 70 percent of Slovaks are satisfied with the introduction of the euro. Undoubtedly, the countries paying with the euro are viewed as more trustworthy by our foreign partners than those using their national currencies," Zeman said.

Sme.sk wrote that the Czech economy fares well, having grown by 4.5 percent in the first three quarters of the year. It has also been boosted by exports thanks to Prague´s policy of the cheap crown, Sme.sk wrote.

According to Zeman, this policy helps only in the short term and it rather arouses fears of the future.

"The devaluation of the crown, which also means the depreciation of households´ savings, will result in the weakening of the pressure for innovations, because the situation is more comfortable. Comfort means that you innovate less than if you were under a stronger pressure, from a strong crown, for example," Zeman said.

"Another apprehension is that before joining the euro zone, we will try to achieve the most advantageous exchange rate. However, the Czech crown´s exchange rate in relation to the euro is extremely disadvantageous now," Zeman said.

The Czech National Bank (CNB) has been intervening to weaken the crown since 2013. It is expected to terminate the cheap crown policy in the latter half of 2016, Sme.sk wrote.

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