Local view for "http://purl.org/linkedpolitics/eu/plenary/2011-03-08-Speech-2-475-000"
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"en.20110308.25.2-475-000"2
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"Madam President, honourable Members, we are currently experiencing one of those incredible moments when the historical process seems to speed up. On our doorstep, on the other side of the Mediterranean, a wind of freedom has started to blow.
Today, everyone admits that there is a need for genuine European economic governance and, moreover, the markets are continually reminding us how essential this is. This is the reason why the Member States, in the conclusions of the work of the task force, presided over by the President of the European Council, arrived at a very broad consensus on the proposals presented by the Commission on strengthening economic governance – proposals that are currently under discussion here in Parliament and in the Council.
Furthermore, we came to an agreement on the implementation of the European semester, which will help to extend economic governance, by including in the early stages not only budgetary policies but also economic policies and structural reforms for each of the Member States. It was within this context of strengthened economic governance that recently, the idea of a ‘competitiveness pact’ emerged, inviting Member States in the euro area to make additional efforts, largely on the basis of their national competences, to become even more competitive.
It is true that whilst the economies within the European Union are indeed extremely interdependent, those of the euro area are particularly so.
Gaps in competitiveness are a genuine problem for those countries which share the same currency. Their competitiveness and the convergence of their economies are essential in ensuring the viability of a strong and stable euro area, which will be to the benefit of the entire European Union.
Having said that, we must recognise that this idea has raised a number of concerns: fear of a two-speed Europe (the euro area and the others), the danger of losing sight of certain aspects of the economic recovery that are just as important as competitiveness, and also possibly the calling into question of the Community approach. These are all legitimate questions and we must respond to them unequivocally. This is a question of mutual confidence and credibility.
Honourable Members, I was also a little surprised to have to point out, at the last European Council on 4 February, that any specific initiative for competitiveness and for the euro area had, quite obviously, to be in accordance with the Treaty.
In its conclusions, the European Council decided that ‘in taking their inspiration from the new framework for economic governance, the Heads of State or Government will take additional measures with the aim of enhancing the quality of the coordination of economic policies within the euro area in order to improve competitiveness, and this would lead to a greater degree of convergence without harming the single market’.
Moreover, I was very happy to see that, in the end, these conclusions contained explicit reference to the need for these additional advances to be made ‘in accordance with the Treaty’. You might think that this goes without saying, but it is better that it is said.
The European Council therefore gave the President of the European Council a mandate to lead, in close collaboration with the President of the European Commission, consultations with the Member States of the euro area in order to determine the concrete means needed to press ahead with this.
These consultations clearly showed that, in general, Member States are in favour of adopting the Community approach.
This is such an important and urgent matter that I should first of all like to tell you that the College has just approved the Commission’s contribution to assist the countries south of the Mediterranean in their transition process and to breathe new life into our relations with our Mediterranean neighbours. I shall present this contribution with Baroness Ashton during the Extraordinary European Council next Friday.
Now I would like to be very clear on the principles that, in the Commission’s view, must necessarily be abided by for such a competitiveness pact, which it might be better to call a ‘convergence and competitiveness pact’, since it involves measures aimed at reducing differences within the euro area, and indeed within the European Union.
The first principle is that this pact must be carried out under the conditions laid down in the Treaty and within the existing system of economic governance. We can, in this way, be sure of a truly Community approach. Because history, and notably the experiences with the Stability and Growth Pact, has shown that it is only through the Community method that we can produce results which are democratically legitimised at European level, and which are binding and can be controlled.
The pact must, of course, also respect the role of the Commission. This is essential in order to guarantee objectivity and independence in monitoring the efforts of Member States, the integrity of the single market and of all the
and the clearance between the initiatives taken in the euro area and those pursued in the European Union as a whole.
I will also insist on the role of the European Parliament in monitoring the convergence and competitiveness pact because the Commission, of course, will fully inform the European Parliament.
The pact must also remain open to other Member States which might wish to take part in it and that are not members of the euro area. I think it is important to avoid any kind of stratification in our Union; that stratification will go against the very principles of solidarity that are at the core of our common project.
To justify such a pact – which involves national measures – it must contribute added value to what has already been laid down in the context of economic governance proposals put forward. I would remind you that under Article 121 of the Treaty, Member States must coordinate their national economic policies. Such a pact must also take care not to affect adversely the integrity of the single market and should even help to enhance it. In addition, it must respect social dialogue and link measures on competitiveness to our central goals, which are growth and jobs, exactly as we have stated in the Europe 2020 agenda.
Competitiveness is indeed an essential element for our economies. It is a necessary condition for entrenching job-creating growth. It is therefore important to ensure that this pact delivers real added value and does not take us away from the essential goals of growth and employment. My bottom line is growth and employment. That is why I emphasise growth, the sort of inclusive sustainable growth which lies at the heart of the Europe 2020 strategy.
That is why I insist so much on the social dimension, since the efforts required must be shared fairly. On this point, the Commission continues to work on a proposal for the taxation of financial activities. Similarly, if budgetary consolidation and structural reforms are essential for competitiveness, investment in sectors of importance for the future like research and innovation is just as necessary.
We should also bear in mind that this pact is but one part of our overall response to ensure the stability of the euro area. Progress must be made in all the other areas of our response, that is to say, in enhancing the effective financing capacity of the existing European Financial Stability Fund and broadening its scope, in preparing the establishment of a permanent mechanism as from 2013 and in implementing over the coming months tighter stress tests for banks. All of this will contribute to greater transparency, greater confidence and greater credibility.
The convergence and competitiveness pact could thus make a significant contribution if we interpret it as one measure among others within the framework of all the efforts which have been undertaken to ensure the stability of the euro area and which we hope will start to take effect as of March.
The men and women on the southern shores of the Mediterranean, especially the young people, are currently demonstrating their rejection of authoritarian regimes and their aspiration to political freedom and social justice.
It could constitute a major additional effort towards fair and sustainable growth in Europe if it is coherent with the Community system of governance. If that is the case, if this measure is effectively carried out following a Community approach, as is the wish of the Commission and this Parliament, then I believe that the convergence and competitiveness pact will deliver added value and could help to strengthen the economic pillar of economic and monetary union. That is what this Parliament and the Commission want. The Commission will spare no effort to that end. I thank you for your attention.
Although we are aware of the extreme complexity of the situation and the challenges and difficulties that it presents, the European Union cannot afford any ambiguity. We must stand shoulder to shoulder with those who are demanding political freedom and respect for human dignity. We cannot countenance any ambiguity on the part of the European Union. A regime which fires on its own people has no place within the concert of nations.
We are offering these peoples a ‘partnership for democracy and shared prosperity’ founded on three pillars: democratic transformation, involvement with civil society and mutually supportive development.
We are aware of the challenges that await us. Saying no to dictatorship does not automatically guarantee the rule of law and democracy. The road to democratic transition is never an easy one. It can sometimes be winding and it is always demanding. However, Europe must stand shoulder to shoulder with those who aspire to political freedom and social justice.
Honourable Members, I would now like to turn to the other meeting to be held on Friday 11 March, the informal summit of Member States in the euro area.
The crisis has shown just how interdependent our economies are. It has shown up certain structural weaknesses. That is one reason why we must strengthen our economic governance.
The Commission has long fought for more coordinated national economic policies and stronger governance in Europe. Our proposal is to further develop the economic pillar of our Economic and Monetary Union. We highlighted this point in our report on the 10 years of the euro, EMU@10. However, the truth of the matter is that some governments were extremely reluctant to espouse a development of this nature."@en1
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