On the theme of: ‘Economic Governance – From crisis to resolution, from monetary to economic union?’, Euro Group President Jean-Claude Juncker stressed at a Briefing of the European Movement International (EMI) that Eurozone economic and monetary policies should only be discussed behind closed doors in “dark secret rooms” in order to prevent dangerous movements in financial markets. He added that “if you are pre-indicating possible decisions, you are fuelling speculation on the financial markets, throwing into misery mainly ordinary people whom we are trying to safeguard from this.”

Expressing his particular scepticism with regards the so called Euro-plus-pact, aiming at increased coordination of the Eurozone economies and at boosting their competitiveness, he remarked: “I never was and never will be a strong believer in the virtues of this Euro-pact. As I was part of those who have adopted this pact, I can’t criticize it too much, but would I have been alone, this pact would never have been adopted as there is nothing new in it. All elements had already been on the table of the Commission and the Council, but there was never much political will to implement them”.

The Prime Minister also used the occasion to underline that the changes proposed by the European Parliament to the EU economic governance legislation “point in the right direction”, hoping for an agreement between the Parliament and the Council to be reached before June, so that EU leaders could adopt the final version at a summit in mid-June.

Summing up his intervention he stated that “the European project remains the best thing ever done on the European continent. If we wouldn’t have launched the single currency after a painful process of readjusting our public finances and all the currencies which were qualifying for the European Economic and Monetary Union we would face today an even larger chaos. If we would have national currencies instead of a single currency and if we would have 27 Member States in Europe going their own way without trying to find their place in this sphere of solidarity and peace that is provided be the European Union, the European continent today would be in a totally disastrous situation. We are not able to explain to Europeans the costs and the reality of the non-Euro.”

Pat Cox, President of the European Movement International, remarked that Juncker is “a man who comes from one of the smallest member states but whose European qualities know no frontier. He is one of the few significant European leaders who has taken the political risk to suggest some of the potentially viable long term solutions needed to overcome the financial crisis.”

However, Mr. Cox noted that “despite the great progress made, the crisis has not passed yet. One hopes its worst aspects might be contained but the truth is we don’t know. What we have started together with the Euro and where we have brought it through the Governance initiatives is a significant step forward but is still only a step on the road. The economic circumstances of the Eurozone, the impact of rising commodity prices, particularly for developing economies and high public finance deficits and debt especially in the USA all suggest that the world economy remains in a fragile state.”

As Irish European, he took a particular view on the crisis and noted that “the indispensable financial assistance of the European Union and the IMF provides a space for Ireland to reform and hopefully in time to return to normal business and to find the funds Ireland needs in the market place.” He underlined that Ireland “is a proud nation” and that the Irish are no “free riders, looking for something for nothing.” However, he remarked that the “€70 billion of socialised private banking debt now being paid by Irish taxpayers largely related to German, French and British banks loans made to Irish banks during the boom for which these lenders now carried neither moral hazard nor financial consequences, in effect a reverse transfer union from a peripheral state’s taxpayers to imprudent bank lenders in several larger member states.”

Jo Leinen, EMI Vice-President and chair of the debate, expressed his appreciation of Jean-Claude Juncker for his ability to critically reflect on decisions taken on economic measures in his function as President of the Euro Group together with European leaders and for being able to see both sides of the coin. He concluded that the European Movement International is looking forward to and will closely follow further developments in the capacity to act of the Eurozone.
[ENDS]

Audiovisual coverage:

Speech of Euro Group President Jean-Claude Juncker, please click here

Speech of EMI President Pat Cox, please click here

Speech of Bavarian State Minister Emilia Müller, please click here
————————
Editor’s Note: The debate was kindly hosted by the Representation of the Free State of Bavaria to the EU.

For more information, please contact the secretariat: +32 (0)2 508 30 85,
E-Mail: communication(at)europeanmovement.eu