(Repeats story published late on Tuesday)
By Mark John and Jan Lopatka
PRAGUE, Oct 14 (Reuters) - The Czech government accused EU
countries on Tuesday of writing blank cheques to their banks in
response to the financial crisis and said the actions taken so
far had made euro entry less attractive.
The Czechs, who take over the European Union presidency in
January, have been largely sheltered from the global economic
crisis. They only reluctantly signed up to an EU plan to raise
bank deposit insurance and plan no further action to prop up
lenders.
Speaking on the eve of an EU summit where Britain and euro
zone countries will present details of plans to shore up their
banks, Czech Prime Minister Mirek Topolanek said he would seek
assurances that the bloc's rules are not discarded.
"If individual governments declare they will do everything
to avoid the failure of any of their institutions, they
implicitly say that it is of course at the expense of the
Stability and Growth Pact and the rules governing the euro
zone," the right-wing prime minister told a news conference.
The EU has rules defining the use of state aid to prop up
ailing businesses and caps public deficits at 3 percent of gross
domestic product.
"I will require reassurance from the European Commission
that there is no illegal public support, and a breach of law in
the measures being prepared," Topolanek said. "If there is a
breach of law, I will want a clear declaration in the (summit)
conclusions."
EU countries have pledged to provide more than 1.5 trillion
euros in guarantees and equity capital to avert a collapse of
their financial systems.
The commission presented guidelines on Monday on how
countries can help banks without breaching EU competition rules,
and promised swift approval of eligible schemes.
The Czech criticism reflects the view of some other EU
states such as Poland, where some politicians have argued the
bloc should take an equally favourable view on efforts to rescue
the country's shipyards.
It also highlighted differences between the small, former
communist country with a government wary of losing influence in
a more integrated EU, and the leading EU nations ahead of the
Czech presidency.
EURO DISCOURAGEMENT
Czech Finance Minister Miroslav Kalousek said steps taken by
the EU governments poured cold water on plans to join the euro.
"There should be no doubt that what is happening in Europe
will significantly influence the thoughts on the date of euro
adoption," said Kalousek, who had earlier said those Europeans
offering a blank guarantee of bank deposits were going "crazy".
The government has no euro entry target, but is under heavy
pressure from business to set a timetable.
"For years, principles of the Stability and Growth Pact were
being built," Kalousek said. "For years, principles of fair
competition and deposit insurance were being built and today ...
it is as if these principles did not exist. As if the principle
of 'rob your neighbour before he robs you' prevailed."
French President Nicolas Sarkozy has said the current crisis
is severe enough to invoke a clause allowing the EU's strict
deficit limits to be waived.
Ireland has drawn ire from other EU members for extending a
full guarantee of bank deposits, a measure sucking in money from
other EU states.
(Additional reporting by Jana Mlcochova; Editing by Victoria
Main)
