Local view for "http://purl.org/linkedpolitics/eu/plenary/2010-06-16-Speech-3-070"
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"en.20100616.4.3-070"2
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"Madam President, let me thank you first of all for a very substantive and responsible debate and for your draft resolutions on Europe 2020 and economic governance. I also want to thank you for your support for the work the Commission has been doing, especially in the fields of financial market reform and the reinforcement of economic governance.
Europe’s strategy of coordinated and differentiated fiscal exit was recognised, and indeed endorsed, by our G20 partners and the G20 Ministers therefore agreed on the need for differentiation very much in line with the European Union approach.
Secondly, the G20 must also aim at rebalancing global demand. This will put the world economy on a more sustainable and higher growth path as we come out of the crisis and for that, it is essential that we tackle global imbalances, especially between the US and China.
The third major issue is, of course, financial market reform. There has to be a real step forward at the Toronto Summit, given its importance for global stability and also for the credibility of the G20. Therefore, the G20 in Toronto should carry through the rules agreed on improving bank capital, taking action on non-cooperative jurisdictions, and reforming the derivatives markets.
In particular, we need a strong message from Toronto on bank levies and the G20 needs to show that it is coordinating and delivering on this. No consensus was reached in Busan, Korea, on the idea of such a levy on financial institutions to foster financial stability and strengthen the resolution framework but, on the other hand, there was agreement on developing a common set of principles on burden sharing.
It is indeed essential that the public sector should not bear the cost of the financial sector’s failures, and the principles should also reflect the possible costs of resolution and incentivise appropriate behaviour.
The finance ministers also agreed that further progress on the financial repair of the banking and financial sector is critical for global recovery. These discussions will continue in Toronto, and I can say from the point of view of the European Commission that we are in favour of broad transparency over the bank stress tests, which are essential to restoring and reinforcing confidence in the European economy.
In conclusion, for both the European Council and the G20, it is now high time for delivery on a smart strategy over fiscal exit, growth enhancing, balancing and reforms, financial market reforms and reinforcing economic governance. It is essential that the European Council and the G20 now rise to the occasion and concretely deliver at this critical moment for the European economy as well as for the global economy.
I would also like to thank Diego López Garrido and his team and the Spanish Presidency for their excellent cooperation and extraordinary performance during these very difficult times in Europe with the most severe financial crisis and economic recession for ages. It has been a great pleasure to work with you and I highly appreciate that. Of course, I want to wish the best of success for Spain today. I could wish some success for Switzerland as well but only once they have joined the European Union!
Tomorrow’s European Council will take place in a rather dualistic economic situation. On the one hand, economic recovery is in progress and is increasingly gaining momentum, even though it is still gradual and fragile. On the other hand, the turmoil in the sovereign debt markets has cast a serious shadow over financial stability in Europe, which could, at worst, derail the still nascent recovery of the real economy.
The European Union has taken coordinated and determined action to prevent a financial meltdown, but we are certainly not yet out of troubled waters. We must stabilise and reform our economies to pursue sustainable growth and create the jobs Europe badly needs. That is what our citizens expect from their leaders. The European Council must show the way and take bold decisions to this effect tomorrow.
In that context, it is particularly essential to reinforce economic governance in Europe. We need to upgrade preventive budgetary surveillance to avoid future crises, we need to address macro-economic imbalances to go to the root of the problems and we need to construct a permanent mechanism for crisis management. All in all, it is high time to feel at ease with life in the EMU and to create a genuine economic union to accompany the monetary union that already exists.
The European Council made a very important decision when it asked President Herman Van Rompuy, in conjunction with the Commission, to set up the task force to suggest ways and means to enhance economic governance. Tomorrow, President Van Rompuy will give a progress report on the work of the task force and the first set of orientations. The Commission’s communication of 12 May has provided a solid foundation for the work of the task force. There is broad support for our initiatives and we shall follow them up shortly with concrete reform proposals.
We must now seize the moment to complete the construction of the economic and monetary union. I count on your support in this regard. I count on your support for our proposals and for the Community method, which we have to maintain and further reinforce in this context. Let us keep up the momentum, get results and have the new system functional already by the beginning of next year.
Concerning the Toronto Summit, the overarching theme should be to strive for unity, redress the problems we are facing, reinforce confidence in the global economy and safeguard economic recovery. I took part in the preparatory meeting of finance ministers and central bank governors in Busan, Korea, two weeks ago, and I shall also accompany President Barroso to the Toronto Summit.
There will be three priority issues in Toronto. Quite briefly on this, the first is fiscal consolidation. There was an important change of tone in Busan in the meeting of the finance ministers and governors. They agreed that the advanced countries, especially the most vulnerable ones, need to accelerate fiscal consolidation. From the EU side, we made it clear that, given the debt levels around the industrial world – in the US and Japan they are higher than in Europe, for the moment – the fiscal problem is a global problem and not one limited to the EU only, and this problem needs to be addressed as such."@en1
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