Банкеръ Weekly



As soon as the agreement for Bulgaria's integration into the European Union (EU) is signed in the early 2005, the European Central Bank (ECB) will provide the Bulgarian National Bank (BNB) with a status of observer in all of its committees. It means that experts in the Bulgarian central bank will be allowed to participate in the meetings of all the thirteen committees of the European System of Central Banks and the ECB General Council. Of course, they will act as observers. However, that will help them know the work better and get ready for BNB's full membership in the system.Right decisions are taken when there is accurate and timely information and we shall have it, BNB Governor Ivan Iskrov declared. In order to present the new status of the Bulgarian central bank, the ECB Management Board member Tomaso Padoa-Schioppa arrived in Bulgaria on October 25. I am here to exchange opinions on the way the process of Bulgaria's integration into the EU will go on, Mr. Schioppa explained. He is responsible for the international and European relations, legal affairs, financial supervision and stability in the ECB Management Board. He had a meeting with the Minister of Finance Milen Velchev, the Minister of European Affairs Meglena Kouneva, and the Governor of BNB Ivan Iskrov.The independence of BNB was among the topics discussed, too. Mr. Schioppa explained that there were no debates on it. He expressed his opinion after he examined the amendments prepared to the Law on BNB that will be voted by the Parliament by year-end.The major topic discussed by Tomaso Padoa-Schioppa and Ivan Iskrov was the new stage of collaboration of the two institutions with regard to BNB's future membership in the European System of Central banks. A report was presented to Mr. Schioppa on the condition of the Bulgarian banking sector and the economy as well as on the expectations for its growth in 2005. Moreover, the BNB Governor explained that after entering the EU Bulgaria would initiate immediate negotiations for successfully joining the European monetary system. Until then, however, the Currency Board will remain the main challenge facing BNB, Mr. Schioppa explained. This is mainly a technical issue but it is also related to the way the Bulgarian economy is growing. The Currency Board is quite a complicated engagement, Mr. Schioppa warned. It operates well when the economy is in harmony with it, most of all the budget expenses and the salaries payments. He recommended that Bulgaria keep its priorities in order to report a higher growth compared to the other EU member countries and thus improve its standard of living. In his opinion, one advantage is the low level of working salaries in the country. Because of them you can expect a higher growth of attracted investments that will provide a higher growth of the economy, Mr. Schioppa summarized.

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