Local view for "http://purl.org/linkedpolitics/eu/plenary/2008-11-18-Speech-2-361"
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"en.20081118.30.2-361"2
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"Madam President, I will try to reply to all of the questions relating to the financial crisis affecting the world’s economy over the last 15 months or more, and which continues to affect the finances of the European economies.
To respond now to the question from Mrs Andrikienė, I would remind you that, according to the Commission, Hungary, Lithuania, Estonia, Bulgaria and Romania are affected more severely by the financial crisis than the other Member States. These States have, for years, benefited from favourable external financing conditions, creating, of course, deficits in the current balances of payments and an accumulation of external debts. It is evident that, now, financing conditions are much less favourable and the problem facing these States is one of refinancing their external debt.
As for Hungary, the Council has just granted a loan of EUR 6.5 billion in the framework of the mechanism for medium-term financial assistance for balances of payments. In addition to the Council’s loan, there are loans from the International Monetary Fund, for EUR 12.5 billion, and from the World Bank, for one billion. I do not know if the latter is in dollars or euros.
With current funding of EUR 12 billion, there is a risk that this mechanism will prove inadequate to meet future requirements, so this is why the Commission has just proposed increasing the assistance available to this country to EUR 25 billion. The Council has asked Parliament to give its opinion on this proposal.
As regards the Union, I would remind you that the European Council of 15 and 16 October stated its commitment, under all circumstances, to taking all necessary measures to maintain the stability of the financial system, support the major financial institutions, avoid bankruptcies and assure protection for savers’ deposits.
As for the financial system, the European Council also made a forceful call for all players in the system to act responsibly, especially in the banking sector. It stressed that the real performance of company directors should be reflected in their remuneration, including severance payments and everything relating to golden parachutes. Similarly, it agreed to ensure that stock option arrangements should lead neither to excessive risk-taking nor to an over-emphasis of short-term objectives.
Following this meeting, the informal meeting of the Heads of State or Government on 7 November, whose task was to prepare the coordinated European approach for the G20 meeting, which took place last weekend in Washington, had the objectives of taking quick decisions on transparency, worldwide regulation standards, especially accounting standards, financial supervision and crisis management, of preventing conflicts of interest and of creating an early warning system, in such a way as to create saver and investor confidence.
To reply more particularly to the honourable Member’s question, tabled on behalf of the Socialist Group in the European Parliament and echoing the question from Mr Evans, on the practical measures being examined to respond to the crisis, I wish to refer to the reform of the Capital Requirements Directive, which the Council is currently considering. The work of the Council on this proposal is already well advanced. The Commission has also just proposed a regulation on an approval system for rating agencies. This proposal is going in the same direction, insofar as capital requirements depend on the ratings awarded.
As for the protection of savers’ deposits, the Commission has proposed to amend the current Directive to increase the minimum guarantee to EUR 50 000, with a further increase to EUR 100 000 planned in future. The European Parliament and the Council are in the process of considering this proposal.
I also note, following the European Council of 15 and 16 October, the introduction of the financial crisis team. This team, as you know, is an informal mechanism for warnings, information exchange and assessment among the representatives of the Council, the President of the European Council, the Commission, its President, the President of the European Central Bank, the President of the Eurogroup and the governments of the Member States, as well, of course, as the President of the Economic and Financial Committee, which is the linchpin of this early warning team.
To reply to the questions put by Mrs McGuinness and Mr Mitchell, I would stress that the European Council approved an action plan to offer Member States a complete common framework of national rescue and aid measures for the financial sector. The European Council called on Member States to take into account the potential effects of their national decisions on the other Member States. We also recognise that Iceland has experienced severe difficulties. A message of solidarity was sent to this country by the European Council in October. There were meetings in the wings of the Ecofin Council on 4 November and, finally, with the Council of the European Economic Area, I personally met representatives from Iceland and believe that we were able to find satisfactory solidarity mechanisms and also adapt the agreements which unite us with this country in the framework of the Council of the European Economic Area.
As for the question raised by Mr Papadimoulis, on the Stability and Growth Pact, I would remind you of the conclusions adopted by the Council on 7 October, in which it confirmed its desire to see the pact applied, whilst taking into account the exceptional circumstances with which we are familiar. Implementation of the 7 October decision must, of course, take account of the G20 conclusions, which call for the use of all available resources to sustain activity."@en1
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