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Central bank governor says question not if Hungary to join euro-zone, but when

Conferences

The question for Hungary and similar countries of central and eastern Europe that have not yet adopted the euro is not whether to enter the euro-zone but when, national bank of Hungary MNB governor András Simor said at an international conference in Austria on Thursday.

"The question for these countries where half of the debt is in foreign currency [...] is to find the most appropriate date for accession, when they are sufficiently prepared to efficiently face competition in the euro-zone", Simor said.

With regard to the current euro-zone debt crisis, András Simor remarked that the zone needs a strong, central institution to enforce compliance with its economic and financial regulations in order to avoid falling into another such crisis in the future.

The MNB governor noted that such European economic powers such as Germany and France, not only peripheral member states such as Greece, have violated euro-zone financial and economic regulations with impunity over the past decade.

The eurozone crisis is not a crisis of the euro but the failure of economic and fiscal policies followed in specific countries, he said, adding that the euro's initial ten years of stability show that the currency has been successful.

There is also need genuine tools and clear responsibilities to prevent the indebtedness of the private sector, the Hungarian central bank governor said. And the ratio of state to GDP should be brought not only to but even under (the Maastricht requirement of) 60% of GDP.

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