Local view for "http://purl.org/linkedpolitics/eu/plenary/1999-11-03-Speech-3-060"
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"en.19991103.6.3-060"2
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"Madam President, I would like to point out that macroeconomic dialogue forms part of the complex process of the Employment Pact and that, as the Presidency-in-Office of the Council has explained, it is a consequence of the Cologne decisions, trying, through the establishment of this dialogue between social partners and the people responsible for economic and budgetary policy with the participation of the European Central Bank, to achieve our ultimate objectives. In accordance with the broad guidelines of economic policy, these objectives simply consist of achieving stability in monetary policy through budgetary measures and wage trends which are appropriate and more favourable to growth and employment, including exchange rates and interest rates in the long term.
Secondly, I would like to point out that there was also absolute agreement on the key principle of the macroeconomic framework, which I referred to earlier. That is, the more we promote the objective of stability of monetary policy through budgetary measures and appropriate wage trends, the more favourable monetary conditions will be towards growth and employment.
Thirdly, I would like to point out that the discussion clearly demonstrated the usefulness of this type of direct exchange, which allows each of the participants to express, directly, their points of view and receive adequate answers from the other participants. The role of the social partners was fully recognised as a third element of the policy mix.
Fourthly, some of the ideas offered by the participants warrant special attention. I would like to highlight the fact that there was an emphasis on macroeconomic policies, particularly monetary policies, having to take into account progress on the supply side of the European economy. In this way, we will increase the possibility of sustaining, without inflation, higher growth in demand. The combination of the complete realisation of the single market together with the single currency, in a context of structural reform and strong international competition, will allow for a reduction in the risk of bottlenecks that may arise in the event that wage and budgetary policies are inadequate.
Lastly I would like to point out that the representatives of the Commission underlined the fact that the supply of labour currently seems to respond more positively than it did previously, but that there exists a significant reserve of qualified and available labour. If we add to this the availability of existing capacity, given the high potential tendency towards inflation, the consequence of raised profitability, structural changes will be put in place which those responsible for economic policy must take into account when adopting their respective decisions.
These are what seem to me to be the most relevant elements of the meeting of 29 October and which, today, as I said, I wanted to share with you so that you may then comment on them and debate them.
The macroeconomic dialogue will be initiated in accordance with this philosophy. Its significance has been clearly defined by the President-in-Office of the Council and I do not intend to insist on it. I simply want to point out that the first technical meeting took place on 29 October and the next will take place on 8 November. Despite previous experiences, such as the social dialogue established after Val-Duchesse, it is clear that the new macroeconomic dialogue has some different characteristics.
I would like to concentrate – so as not to repeat part of what has already been said – on the contribution which the Commission made to the technical debate on 29 October. Firstly, I would like to point out that the Commission’s Directorate-General for Economic and Financial Affairs provided, prior to the debate, two working documents. One related to the economic situation and the other was intended to prepare the informal exchanges on macroeconomic policies in the medium term. Both documents should serve as technical contributions to the debate.
The first Commission document aimed to present the general economic situation and the macroeconomic perspectives in the short term. The diagnosis of trends for the European Union contained in this document is of a descriptive and analytical nature. And its contents confirm that it is possible to have a more rapid return to growth than the one announced by the Commission in its macroeconomic forecast in the spring. The growth announced for 1999 will be around 2%, similar to that established in the forecast. But this 2%, as an annual average, reflects a different performance. Performance was lower than expected in the first part of the year but, nevertheless, the upward trend which will occur in the second part of the year will favour growth of close to 3% as an average for the last two years, thereby reaching similar and even higher figures for 2000 than those which we had forecast in the spring. The document also includes the possibility that growth may be higher in the future.
The second document presented by the Commission must serve to prepare for informal exchanges on macroeconomic policies in the medium term. The document presents the macroeconomic conditions needed to promote durable growth, drawing certain conclusions from the slow growth recorded in the past, especially since the middle of the 1970s. A technical analysis allows us to reach the conclusion that the deceleration of the growth tendency in the European Union can be explained by a combination of external impacts, exacerbated by divergence in national policies, in a context of structural rigidity. In particular, the lack of consensus on the content of macroeconomic policies in the period prior to the entry into force of the Treaty of Maastricht and of the initial guidelines on economic policy played a fundamental role in the increase in negative effects, external impacts and the development of greater obstacles to growth and employment.
It is worth emphasising that the change to the rules introduced on the implementation of Economic and Monetary Union has lightened the load of those responsible for national macroeconomic policy and is helping to overcome these obstacles, so that growth may become more sustainable. The document analyses the conditions necessary so that the policy mix may continue to be as balanced as possible, thereby allowing us to achieve longer-lasting growth.
At the meeting on 29 October there was a discussion of this information which was very open and constructive, and I will tell you about this in a summarised fashion. With regard to the diagnosis of trends, all the participants agreed that the perspectives had improved considerably, and that the negative external impact of 1998 had already been absorbed by the internal development of the European Union itself.
With regard to possible risks to future growth, there were differences of emphasis, especially when some of the participants pointed out the risk that further external impacts may affect the Union’s economy.
In relation to economic policy – the second document provides a response to the challenge of transforming the current upturn into a sustainable process of higher growth – each participant expressed their position very frankly. However, I would like to emphasise some of the elements of the debate which may be very useful for the purposes of today’s debate. Firstly, the broad guidelines of economic policy are confirmed as a fundamental element. All the participants agreed on the need to maintain price stability and negotiate wage agreements which are compatible with the objective of continuing the process of consolidating the budgets – in accordance with each country’s stability programmes – and of completing the structural reforms in accordance with the Luxembourg and Cardiff processes."@en1
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