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15th Aug 2022

Slovak politician calls for 'plan B' to abandon euro

  • Slovakia's euro switchover ceremony - some are already turning their back on the common currency (Photo: European Commission)

Slovakia, which joined the eurozone last year, should have a 'plan B' to return to its national currency, the country's parliamentary speaker, Richard Sulik, has said, amid frustration over the way the eurozone is handling the debt crisis.

"The time is ripe for Slovakia to stop blindly trust in what eurozone leaders say and prepare a plan B. This is the re-introduction of the Slovak koruna," Mr Sulik said in an opinion piece published in the bussiness daily Hospodarske noviny on Sunday (12 December).

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He added: "As we are a country too small to significantly influence EU action, we must at least protect values created by the people living in Slovakia."

Mr Sulik's views reflect a wider discontent with decisions that the eurozone has made since the Greek crisis erupted.

The Slovak centre-right government has repeatedly called for private investors to feel the pain of any rescue operation under the eurozone umbrella. It considers the Greek bail-out a mistake that made European governments a hostage to financial markets.

The parliamentary speaker said it is "irresponsible" for states to risk financial problems at home by taking on the liabilities of their debt-ridden colleagues under the European Financial Stability Facility, a temporary bail-out tool agreed in May and currently providing aid to Ireland.

He also critised the European central bank for its policy of purchasing EU states' bonds.

Slovak Prime Minister Iveta Radicova and the country's finance minister Ivan Miklos were quick to react to Mr Sulik, who also leads a junior coalition party, The Freedom and Solidarity, and is known for co-designing the flat tax in Slovakia.

In the long run, the euro's advantages for the Slovak economy outweight its disadvantages, a spokesperson for Ms Radicova is cited as saying by the daily SME (14 December): "That is why we prefer fact-based solutions to extreme scenarios."

According to the finance minister: "One always needs to be ready for all options, but currently all must be done to strengthen the euro." The costs and consequences of a re-introduction of the koruna would be enormous, he indicated.

Some analysts have described Mr Sulik's comments as dangerous, saying they could influence investors who hold Slovak government bonds or are considering investing in the country.

Bratislava needs to re-finance some €8 billion of its own debt next year and politicians who create uncertainty are playing with fire, the chief analyst of Volksbank Slovensko, Vladimir Vano, said.

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