(Repeats story from late Thursday)
By Jan Strupczewski
BRUSSELS, June 19 (Reuters) - Slovakia will seek a strong conversion rate of
its currency into the euro, its prime minister said on Thursday after European
Union leaders gave his country the green light the euro zone on Jan. 1, 2009.
Left-wing Robert Fico said Slovakia wanted the strongest possible exchange
rate for its crown currency into the euro, when it would be set in July by EU
finance ministers, but not one that would harm economic growth.
"We want the strongest possible conversion rate ... that people can pay as
few crowns as possible for the euro," he told reporters at an EU summit in
Brussels.
"But too strong a conversion rate could reduce economic growth. We would
like to keep economic growth at the highest possible level and the people to
profit from it (the conversion rate) as much as possible."
The Slovak crown rose against the euro <EURSKK=> on Fico's remarks to 30.285
from 30.355, according to Reuters' data.
The EU's 27 leaders earlier approved as expected Slovakia's bid to the euro
zone's 16th member, despite European Central Bank concern over the country's
inflation.
"We have the euro. Definitely. This is a big success of Slovakia, because it
met all the criteria in difficult times of food and oil price rises," Fico said.
Analysts say that a strong conversion rate will help Slovakia fight
inflation. Fico has said it will also make the country's 5.4 million citizens
richer when their salaries are translated into euros.
The EU leaders concluded, as recommended by the executive European
Commission, that Slovakia met all euro entry criteria on inflation, interest
rates, budget deficit and currency stability.
Slovakia will become the fourth of the bloc's new members that have joined
the EU since 2004 to adopt the euro. Much smaller Slovenia entered the single
currency zone in 2007, followed by Cyprus and Malta this year.
Bigger EU newcomers Poland, the Czech Republic and Hungary are expected to
adopt the euro well after 2010.
LEAK ALLEGATIONS
EU finance ministers will on July 8 give the final blessing for the
ex-communist country's euro adoption by setting the final exchange rate between
the Slovak crown <SKK=><EURSKK=> and the single currency.
Slovakia's euro entry process has been clouded by opposition allegations
this week that the government may have leaked information that moved the
currency market ahead of a crown revaluation in May.
Slovakia strengthened the crown's central parity rate last week in the ERM
2, an exchange rate system that is a stability test for the euro, by 15 percent
in local terms and 17.6472 percent in international terms to 30.1260 to the
euro.
Slovak Finance Minister Jan Pociatek has denied the allegations. But Fico
has criticised him for meeting socially on a yacht in Monaco one of investors
who had bought crowns heavily ahead of the revaluation.
EU finance ministers had previously brushed aside ECB concerns about the
country's ability to keep inflation low in a sustainable way, a vague euro entry
criterion.
Slovakia has pledged extra fiscal tightening should inflation prove higher
than it now expects.
(Writing by Marcin Grajewski; Editing by)
