Strasbourg, 17/05/2006 (Agence Europe) - CSU MEP Alexander Radwan affirmed in a press statement on the European Commission proposal on Slovenia's entry into the Euro zone (but not for Lithuania: EUROPE 9193), the need for a strict respect for stability criteria. The MEP warned that the Commission could not afford to make any mistakes and noted that in 2002, “Greece only joined the Euro zone because of false data provided on its public deficit”.
The EP's Economic and Monetary Committee's adoption of the report by Alexander Langen (CDU) on enlargement of the Euro zone constitutes an appeal for rigour and underlines that the Euro zone's capacity for absorbing new countries should be assessed and that they should ensure that new accessions do no weaken economic governance in the zone. However, the report also considers that the inflation criteria (on which the Lithuanian candidacy floundered: Editor's note) should be clarified, given that it was defined before the creation of the Euro zone. It therefore believes that they should take into account what is known as the “Balassa-Samuelson effect”, namely, the fact that economies in catching up phases, in comparison with stronger economies, often register higher rates of growth that inevitably lead to high inflation rates during the transition period.