PRAGUE, June 12 (Reuters) - The euro has hurt Europe by
forcing disparate economies to share one monetary policy, and
the changing global environment will pose further risks, Czech
President Vaclav Klaus said on Thursday.
Klaus, long a fierce critic of the euro and the European
Union, wrote in the Financial Times that Brussels was not able
to react to the growing ambitions of developing countries and
rising commodity prices.
"In practice the euro has shown that forcing an
economically disparate Europe into a homogeneous entity through
a political decision is political engineering par excellence and
has been far from beneficial for all the countries," wrote
Klaus, a right-wing economist.
The Czech Republic joined the EU in 2004 but has taken a
cautious stance toward adopting the common currency and is not
expected to do so until after 2012.
Its centre-right government, led by Klaus's party, has not
set a firm entry date, saying the country first needs to
complete fiscal, pension and health reforms and align its
economy more closely with the euro zone.
The European Central Bank, which had its 10th anniversary
last week, is facing the highest inflation rates in its history.
However, many economists say the euro has shielded European
economies from the capital flight, interest rate hikes and
eventual devaluations experienced by countries like Britain and
Italy in 1991 and other previous slides in the dollar.
Klaus, who does not have a say in the country's euro
adoption plans, said European countries needed different
interest and exchange rates, and the euro was a drag on growth.
"European politicians expected the euro to speed up economic
growth in Europe, which lagged the rest of the world, but the
currency's adoption resulted in a further slowdown," he wrote.
Europe's economy faced tough tests ahead with the growing
cost of energy and the rise of developing states, he said.
"Brussels bureaucrats are not able to react to changing
conditions. They underestimate the struggle for raw materials
and the pressures posed by the economic emancipation of
underdeveloped countries," Klaus wrote.
"They blindly keep on making climate change their global
priority."
Klaus has long criticised efforts to curb carbon dioxide
emissions, saying green policy efforts were a leftist-led attack
on freedom.
He said politicians would soon try to pressure the European
Central Bank to adjust its monetary policy to meet the needs of
only the largest, most influential countries in the euro zone.
"If Europe does not wake up, it will face hard times. A
common monetary policy will not help," he wrote.
(Reporting by Jan Lopatka; Editing by Gerrard Raven)
