Bulgaria should not join EU's banking union - central bank governor.

By bne IntelliNews September 18, 2012
Joining the EU's banking union will not be beneficial to Bulgaria at the current stage, central bank governor Ivan Iskrov said. Although the central bank supports the idea of higher integration and governance within the euro area, accession to the banking union would entail a unilateral transfer of considerable national sovereignty to Frankfurt and Brussels. Introduction of a common tax policy for all EU member countries is also not in Bulgaria's best interest as coordination of the tax policies will hurt the competitiveness of the economy and compromise the freedom to pursue an adequate economic policy. The central bank backs the sovereignty of the country's tax policy, including the low tax burden, which is an important economic advantage of Bulgaria. Last week, Austrian central bank Governor Ewald Nowotny, said that Eastern European countries-members of the EU should have the option to join the bloc's banks supervisory body. Western banks have a wide presence in Eastern Europe, which justifies opening the single supervisory mechanism programme also to countries which have not adopted the euro currency yet. Under the proposed by the EC package for banking supervision in the Eurozone, the ECB will be in charge of supervising the euro area banking system.

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