LONDON, May 15 (Reuters) - Following are comments from
policymakers from central and eastern Europe speaking at the
annual meeting of regional investment institution the European
Bank for Reconstruction and Development.
CZECH CENTRAL BANK GOVERNOR ZDENEK TUMA ON EURO:
"The euro as such is not a panacea... Monetary policy cannot
resolve structural issues of the economy.
"I don't think that (euro adoption) is a general
prescription for countries in the region... Speaking for
instance about the Baltic countries, the euro tomorrow would be
a solution. It would be the cheapest way to help those
countries."
On the Czech crown:
"In the short term, the depreciation of the Czech crown
would be supportive of Czech exporters at the moment and
hopefully it would help us smooth out the present crisis.
"On the other hand, the euro is considered the safe shelter
and regarding the debt service, the Slovaks borrow cheaper than
the Czechs at this moment."
"Obviously in the long run it makes sense for Slovakia to
have eliminated the exchange rate risks and this is something
that is welcomed by exporters in the long run."
BANK OF ENGLAND BOARD MEMBER TIM BESLEY
"We're going through a period of really quite striking
deglobalisation in both goods and capital markets, and it's
impossible to know whether this is a temporary blip or the
beginning of a more protracted reversal. A lot of that depends
on a diagnosis of the underlying causes of those reversals,
which it's very early days to make a call on."
INTESA SANPAOLO CEE HEAD GEORGY SURANYI, FORMER HUNGARY
CENTRAL BANK GOVERNOR
"The difference in policy response (between central/eastern
Europe and developed economies) was striking. While Western
European countries responded with anti-cyclical monetary policy
but central european countries, because they had lost the
independence of central banks, neither fiscal nor monetary
authorities were able to respond anti-cyclically.
"Most of them, except perhaps the Czechs responded
pro-cyclically which will cause an even deeper recession (in
coming months). So without the real lender of last resort, I
don't see a solution for the region.
"The relationship (between eastern and western Europe) is so
close that if we withdraw significant amount of funds it would
be very detrimental to core countries of the EU as well. For
instance a quarter of German exports is directed to the region.
So if we withdraw it will be incomparably more difficult for
core countries, not only for the financial sector but also for
the economy as a whole."
ALGIRDAS SEMETA, LITHUANIAN FINANCE MINISTER
"We are in constant dialogue with international financial
institutions about policy, including the IMF. We don't reject a
time in the future when we make an application to the European
Commission."
Asked about the chances of seeking IMF aid, he said:
"Currently we are able to do it by our own."
"After the cuts we have made, we are coming for a (budget)
deficit of around 5 percent of GDP. But we are prepared to make
additional fiscal consolidation."
"Fortunately our banks meet all regulatory criteria as well
as adequacy requirements. the situation in our banking system is
stable. There is no bank that needs government assistance.
"We expect a change in economic trends in the second half of
next year and our current forecast shows in 2011 we could change
towards economic growth and current projections in 2011 show we
could expect growth approximately 4 percent.
RAIFFEISEN INTERNATIONAL <RIBH.VI> CEO HERBERT STEPIC
"I really doubt that many people in this room believe the
crisis is over. On the contrary I think this is the beginning of
the crisis of the real economy.
"We operate in all countries and frankly speaking, the
support of the western european governments, to offer banks
packages, that was key to the survival of the banking sector,
especially in emerging countries.
"The difficulty I found while talking to eastern european
counterparties -- they usually denied they had a problem --
almost all of them said 'we dont have a problem, we have a sound
economy, what we are talking about in financIng needs is
appropriate'. In reality in the end they all came to the IMF.
They started relatively late to take measures."
NATIONAL BANK OF KAZAKHSTAN GOVERNOR GRIGORY MARCHENKO
"It has been presented as if Kazakhstan wants to introduce
legislation to impose capital controls. But we are not planning
to impose capital controls, in 2007 we joined the Article 8 of
the IMF on the capital account. In February we devalued the
tenge and in the past month we have been buying dollars. When
you don't need to defend the exchange rate why should you impose
capital controls?"
(Compiled by Patrick Graham, London Treasury Desk +44 207
542 4441)
