Time to reform the euro in 2022, Hungary central bank chief says
sIn economic convergence, the biggest challenges are geopolitics, new technologies and the new financial system, and there is also the megatrend that is climate change, Matolcsy said at the conference on Monday.
According to Matolcsy, Hungary has been on a sustainable convergence path since 2013, with its average 3.8% annual growth more than 2 percentage points above the euro area's average. GDP per capita is currently 73% of the EU average and is closing the gap. The third important pillar of convergence is that Hungary's debt could drop below 60% of GDP by 2022, the MNB president said.
Twenty years after the euro's introduction, some basic conditions have still not been met, and there is a need for a new dialogue on how to reform the euro area, Matolcsy said, adding that the upcoming 30th anniversary of the Maastricht Treaty in 2022 would be a good occasion for reforms.
In theory, all member states undertook at the time of accession to eventually introduce the euro. However, we were not present in Maastricht in 1992 and were not involved in setting the criteria,
Matolcsy stated.
Peter Praet, former Belgian member of the European Central Bank's board and the recipient of this year's Lámfalussy award, concurred that urgent reforms were necessary. Imbalances were already present in the first decade of the euro area but the signs have been ignored, he added.
It is important to set deadlines on these reforms. It is not enough to say we will eventually finalise the banking union, we need deadlines.
Praet said.
