Local view for "http://purl.org/linkedpolitics/eu/plenary/2011-11-16-Speech-3-071-000"
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"en.20111116.5.3-071-000"2
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"−
Mr President, I will be very brief.
We will work on these three channels and we will discuss them in December. I am sure that we will also discuss them again in this Parliament and at the European Council in the months ahead
I will make two small comments on division in Europe. Ladies and gentlemen, the thing that would create the biggest division – which will not be the case – would be failing to guarantee stability in the euro area. Should that happen, division will indeed be great. We must therefore provide the 17 countries with all the instruments and means to ensure they safeguard stability in the euro area. In my opinion, this is the primary objective. At this stage, I am not concerned about knowing whether so and so is frustrated or whether so and so would love to have this or that. We must do everything in our power to ensure that we are sailing in the same boat: first of all the Seventeen, and secondly the Twenty-Seven. However, the primary objective is to secure financial stability in the euro area.
Just one final comment on economic growth. It is not just a European problem. Obviously, we have to make our own contribution to growth and the first condition is to restore confidence in our own zone because the recession, or rather the stagnation these days is caused, in the first instance, not by austerity policies but by the lack of confidence shown by investors and consumers in the euro area. This mainly explains the current stagnation. There is obviously the United States which is also suffering a debt problem and which is also suffering a structural problem with its economy. I was just there in September and I heard business leaders there saying practically the same as they do in Europe. Of course, emerging countries are also experiencing a loss of growth. I have to be extremely wary in how I express myself when I say that they also need to accept greater flexibility in their exchange rates so that the problems they face are not exported to other parts of the world. Growth is a whole. It is not just Europe and in Europe, it is not just a matter of austerity, it is also a matter of confidence.
We need to work on economic growth. We also need to work on it using non-financial means, hence the importance of the single market. We have not yet exploited all the possibilities of the single market by far. We must work on different levels and not only in Europe but across the entire planet.
These are some of the explanations that I wanted to give you in this debate on economic governance.
I was invited here by the President of Parliament to talk about economic governance. This was the subject in preparation for the European Council to be held on 9 December including the report that I had to deliver in cooperation with the President of the Commission and the President of the Euro Group. It was the subject of this debate and I therefore stuck to it.
I was very analytical in my introduction. What has been done and what will be done? It is as simple as that. I therefore drew up a list, a summary, in fact, of what has been done. Is it enough in itself to say what is being done? No. It is a completely factual report that has been drawn up, which should have been done long before the euro area crisis. It was not done, it was not even requested and now we are paying the price for it.
After the chapter about what has been done is the one about what should be done. Once again, chapter by chapter, I will put forward the subjects that we need to discuss. These subjects are central to the interim report that I will make in December with Mr Barroso and Mr Juncker. These subjects involve budgetary discipline, budgetary integration, in fact the Economic Union, and economic convergence. For each subject, I have specified the issues to be raised. It is not about me having to come up with a plan at this stage.
What is more, I have nothing but respect for the Community method. The Commission is the one that has to come up with the proposals, not me. It is therefore the Commission which has come up with the proposals and which will continue to do so. My role is to try and find a consensus at the European Council between both the Seventeen and the Twenty-Seven. That is my role and that is why I was asked to take on this job. I will do it. Yet I think that I asked the right questions earlier and I thank those of you who wanted to put their point across on those issues now on the agenda and on economic governance.
As for the three major issues – budgetary discipline, budgetary integration and economic convergence –, I have just one comment. What we are experiencing is a private debt crisis, made much worse by what the banks and financial institutions did not only in Europe, but across the globe, and in a way, I would say by a global policy of extremely low interest rates. That brought about escalating debts in some countries, which led to a loss of competitiveness and the current balance of payment deficits. Many of the problems we face stem from this, alongside a sovereign debt crisis. Private debt and public debt are what got us into this trouble in the first place.
I often hear a lot of talk in this House about the effects of the austerity policy, but seldom do I hear anybody saying much about this policy of budgetary discipline being inevitable in many countries. Some countries are not under attack from the financial markets, and there is a reason for that: they have conducted a sound enough budgetary and economic policy. If all countries had a, shall we say, satisfactory ratio in terms of private and public debt, we would not be in this euro area crisis. First things first, then: we need to bring each house into order. That comes at a cost, I know, but it is absolutely essential. Even for conducting a policy of budgetary integration, and there has been a lot of talk about stability bonds, Eurobonds, a way of pooling the debt. That cannot be done without budgetary discipline. They go hand in hand. The two go together.
Yes, it has been said, I agree, but there has been no real focus on it. This is the very least that can be said. If we want to go along the path of budgetary and financial integration, we need to do so in stages, because we are currently not ready for fully-fledged budgetary integration as there are too many economic, social and budgetary divergences within the euro area.
When the rate of youth unemployment stands at 8% in some countries and 48% in others, we are not ready; the divergence is far too great. Therefore, if we want budgetary integration, we need to choose the means and the instruments, then see if there is a need for Treaty change for some methods and if there is no need or less need for others."@en1
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