BRATISLAVA, September 7, (WEBNOVINY) — Prime Minister Iveta Radicova informed that at this Wednesday’s Cabinet session, National Bank Governor and member of the ECB Governing Council Jozef Makuch said that the euro will need a fiscal union to work in the long-term. According to Makuch, mechanisms adopted at the level of the European Council are only a short-term solution. “The euro is a stable currency, yet it’s only standing on one leg,” Radicova paraphrased the governor.
At Wednesday’s Cabinet session, Makuch presented his report on development of the eurozone, which was not intended for the public. Prime Minister Radicova said the situation in eurozone was critical and it is held above water by non-standard measures of the European Central Bank. Makuch is expected to participate regularly at Cabinet sessions in the future in order to inform the ministers on current developments and actions of the ECB.
However, the Prime Minister did not comment on the proposal on creating a fiscal union in the eurozone. She only repeated the country’s position that she definitely would not approve harmonizing taxes. “According to our opinion, taxes are an area that has to remain in the hands of nation-states,” said Radicova, adding that with no currency of its own, tax policy is the only major tool nation-states have.
SITA