Hervorming van de Europese economie en het financiële systeem (en)
MEPs and national MPs came together in a two-day debate on 16 and 17 March to debate financial regulation, revitalisation of the EU economy and the world's new financial architecture. Guests included Spanish economy and finance minister Elena Salgado, IMF managing director Dominique Strauss-Kahn, European Central Bank senior economist Jürgen Stark and Commissioners Olli Rehn and Michel Barnier.
On Wednesday, the second day of the meeting between MEPs of the Economic and Monetary Affairs Committee and MPs from EU Member State parliaments, Dominique Strauss-Kahn, Michel Barnier and Mario Draghi all took the opportunity to highlight their organisations' agendas for the months ahead.
The way ahead for the global financial system
IMF Director Dominique Strauss-Kahn had one main message. "The determination to make lasting changes is already receding. But the need for global collaboration is even greater than ever if we want to create a new economic and financial landscape", he said. Collaboration was also needed to solve the underlying problems of the crisis itself which had not disappeared, such as global imbalances.
Michel Barnier, Commissioner for the Internal Market and Financial Services, also believed that time was of the essence in the face of rising nationalism. "This is an opportunity to emerge from the crisis in a different way to the way we entered. We must reject the idea of self-regulating financial markets. For myself I never believed this possible", he warned, cautioning however against over-regulating. Outlining the Commission's agenda, Mr Barnier said a proposal would be made on dealing with naked selling and credit default swaps as early as June.
Moving from policy to action on banking supervision
Financial Stabilitiy Board (FSB) chairman Mario Draghi told the meeting that 2010 would be the crucial year for translating all the political commitments on supervision into a credible structure and body of regulations. Mr Draghi said it was now also time for a gradual but steady exit strategy to be implemented. "Those banks that still needing help should be able to get this. But this help must not hijack the monetary agenda", he said. One of the main priorities for the FSB will be the "too big to fail" banks, because minimum international standards were essential.
Speculation and budgetary deficits
Theodor Dumitru Stolojan (EPP, RO) asked whether credit default swaps (CDS) related to sovereign bonds should be banned, while Philippe Lamberts (Greens/EFA, BE) went even further and asked whether CDS were necessary at all. Mr Strauss-Kahn said that contrary to some beliefs sovereign bond CDS did not have such a big share of the market. Mr Draghi stressed that too little was known as yet about CDS to say that they should be banned.
Asked by Anni Podimata (S&D, GR) if a future European monetary fund could be the solution for another crisis like the one that hit Greece, Mr Draghi replied that such a fund "should always be considered as the icing on the cake". The bulk of the work always had to be through fiscal consolidation. Mr Strauss-Kahn said it was difficult to comment since a number of good, but different, models had been floated for this type of fund.
EU-US regulatory relations
Udo Bullmann (S&D, DE) raised the potential risk of legislative paralyses on both sides of the Atlantic. "What are we going to do about the pressure each administration is feeling from lobbies to regulate as little as possible? How can the EU and the US coordinate their systems?" he asked. Mr Draghi said that it was best to de-dramatise the EU-US rift. "Both sides are not too different in their objectives. It is not a problem if the tools are different. Harmonisation is mostly needed in the two areas of capital requirements and over the counter derivatives" he said.
Reshaping Europe’s economy
Priorities for the EU2020 strategy, EU economic governance, and public finances were the key issues in the first day of the debate on Tuesday.
EU Council Presidency plans were presented by Spain's economy and finance minister Elena Salgado. The Council should agree by the end of March on priorities for the new strategy and a general idea of the type of governance system needed, she said, adding that the Council must use Lisbon Treaty provisions to the full, drop some EU 2020 goals, and make the remaining ones made more comprehensible to the public.
Growth and public finance consolidation
The EU2020 strategy must built on growth and public finance consolidation, said Economic and Monetary Affairs Commissioner Olli Rehn, stressing that "this two-pillar structure is the basis of the Commission proposal". Mr Rehn also called for more co-ordination among EU Member States on fiscal matters and macro-economic imbalances, such as the lack of competitiveness, in parts of the EU.
Time to roll back non-standard measures
European Central Bank senior economist Jürgen Stark offered MPs and MEPs a health check on the EU economy. Signs of stabilisation since Spring 2009 meant that the ECB's non-standard measures could be rolled back, although growth would remain unstable for a while yet, he said, adding that if left in place too long, "such measures could distort money markets, set wrong incentives and lead to price instability". Countering recent criticism of the Bank’s policy in times of crisis, Stark said that policies with a lax attitude to inflation would only distract attention from the fundamental goal of fiscal consolidation.
Jose-Maria Garcia-Margallo Y Marfil (EPP, ES), questioned whether recent statements by Spanish Prime-Minister Jose-Luis Zapatero on binding governance could be implemented since, he said, the EU treaties would not permit it.
Fiscal consolidation
Philippe Lamberts (Greens/EFA, BE), asked why fiscal consolidation plans appear to focus solely on cutting expenditure. "Should we not also see how to reform our taxation systems to raise revenue and ensure more equality?" he asked. "Sustainability is being melted down to a mere adjective in the discussion on EU2020. We have to focus much more on resource efficiency", said Sven Giegold (Greens/EFA, DE), who also contested suggestions by Olli Rehn and Jürgen Stark suggestions that the deficit countries must bear adaptation costs on their own.
Edward Scicluna (S&D, MT), observed that it would be hard to whip up enthusiasm for the EU2020 strategy had when all everyone is currently thinking of is debt. Olle Schmidt (ALDE, SE), by contrast, felt that the situation Europe finds itself in now is infinitely better than that at the end of the 1930s crisis. "We don’t need more pessimism", he said.
Debt co-ordination
Miguel Portas (GUE/NGL, PT), criticized the stability and growth pact criteria as arbitrary. "Why should the deficit limit be 3% of GDP and not 6% and why should the government debt limit be 60% and not 90%?", he asked, adding that "the important thing is not quantitative limits but to co-ordinate debt well at the EU level", he said.
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