Central bank's Isarescu: Accession to Eurozone does not automatically solve economy's problems

Accession to the Eurozone is no panacea, it doesn't automatically solve the problems of an economy, it might even aggravate them, on Tuesday asserted the Governor of the National Bank of Romania, Mugur Isarescu, at the presentation of the substantiation report of the National Euro Changeover Plan, carried out at the Romanian Academy.

"We must all be aware that the accession to the Eurozone is no panacea, it does not solve the problems of an economy, it could even aggravate them, it is only a stage of the convergence process, and for its proper development coherence and sustainability of the economic policies are paramount," the BNR governor warned.

He recommended a sustainable approach to attaining the real convergence of the Romanian economy instead of haste and added that the deadline for adopting the Euro remains a topic open to discussions, reminding that countries with larger economies in Eastern Europe are treating with caution and reluctance the topic of adopting the Euro.

Isarescu warned that the Euro zone countries have not improved their convergence after adopting the single currency.

"It is important to emphasise the significance of reaching a certain minimum degree of real convergence ahead of adopting the Euro, considering that unlike the European Union, the Euro zone proved not to be a convergence club. Its current members have not necessarily improved their real convergence level after adopting the Euro. We must not ignore the problematic of the regional disparities: whilst Romania's real convergence advanced substantially the disparities among its development zones remained visible or even deepened in time. And this was the result of the various rhythms of real convergence, that have led to the appearance of certain regional competitiveness poles once certain poverty areas got chronic. A successful adoption of the Euro asks for concrete and efficient measures in the sense of alleviating this situation," Mugur Isarescu concluded.

The Public Finance Minister Eugen Teodorovici used to say at the beginning of April that Romania has got a very good plan regarding the changeover to Euro and its target clearly remains 2024.