EESC press release
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PRESS RELEASE
No 36/2012
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11
June 2012
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Decision makers meet at the EESC to debate the way
out of the debt crisis
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The search for answers to the EU
economic crisis has continued at the European Economic and Social Committee
(EESC) with a debate on the sovereign debt crisis. In an unprecedented event,
representatives of the EESC, the European Commission, the European
Parliament, the European Investment Bank and the European Central Bank
exchanged views with the Italian Minister for European Affairs and the
President of the Eurogroup.
Staffan
Nilsson, President of the EESC, opened the session with a clear statement
on the sovereign debt crisis, calling for a fiscal stability union in the EU
and the introduction of Eurobonds. Concrete initiatives are needed, he said,
for member states to share fiscal responsibilities and so that interest rates
on the public debt of countries that are making fiscal consolidation efforts
can fall. President Nilsson stressed the importance of creating a growth
model which is credible, coherent and sustainable. Michael
Smyth, President of the EESC Economic Section, made clear that for him
the EU is facing a crisis of demand with dangerous similarities to the crisis
of the 1930s. Today as then, he said, the orthodoxy of austerity is
fundamentally wrong and will only lead to recession. That is why new
strategies need to be implemented at national and EU level. If nothing
changes, Europe may become a breeding ground for populism and radical
parties. "The human cost of the crisis is much higher than the financial
cost", he added.
The
Commission's representative focussed the debate on the creation of a backstop
for the financial sector at EU level and indicated possible options for
progress towards better fiscal integration. The main concern, according to
the representative of the Commission, is the high borrowing costs that remain
in some countries in spite of monetary union. However, there are signs of
shared responsibility, for example in relation to the European Financial
Stability Fund. Carmelo
Cedrone and Gérard
Dantin, rapporteurs for two EESC opinions on Eurobonds and similar
instruments for shared debt, made clear that their expectations regarding
fiscal union are very high. To them, the monetary union was born not only as
an economic project, but an important political venture. As a solution to the
current situation the EESC had concretely proposed two kinds of bonds:
stability bonds to mutualise debt with shared responsibilities and investment
bonds to attract capital from the BRICs.
Sylvie Goulard, member of the European Parliament's Committee on
Economic and Monetary Affairs, stressed that the European Council must not be
the exclusive political arena to tackle the current crisis and that a broader
approach is needed. "We cannot continue staying at the doors of every
European Council meeting waiting for the white smoke from the Sistine Chapel
as if this would solve the crisis".
Enzo
Moavero Milanesi, Italian Minister of European Affairs, spoke in favour of
fiscal discipline as a precondition to the recovery of confidence, as well as
the need to secure the banking system and make sure that burdens are not
transferred to future generations. He also supported greater regulation of
the financial system by member states and European institutions. For the sake
of stability, some type of mutualisation of debt should be established, he
said, while the golden rule of the balanced budget needed to be revised,
giving scope for investment that will result in growth at European level,
such as macro-regional infrastructure projects. Following further discussions
with the European Investment Bank on project bonds and a presentation of the
outside view from the International Labour Organisation, the debate was
concluded by Jean-Claude Juncker, President of the Eurogroup. He confirmed
that Europe and the Euro area will have to take some very crucial decisions
over the summer regarding fiscal integration, progress towards a banking
union and stimulating growth. In response to criticism of the decision-making
process in the Eurogroup, he made clear that this is a small price to pay in
a constant ongoing debate between 17 democratic states, in whose parliaments
more than 60 political parties are represented. "Imagine where we would
be if we didn't have a strong common currency but several national currencies
fluctuating in the global financial storm", he closed the debate.
For
more information, please contact:
Karin Füssl, Head of the Press Unit
E-mail: karin.fussl@eesc.europa.eu
Tel.: +32 2 546 8722
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European
Economic and Social Committee
Rue
Belliard 99, 1040 Bruxelles, Belgium
Tel.:
+32 2 546 8207 – Fax: +32 2 546 9764
E-mail:
press@eesc.europa.eu – Website: www.eesc.europa.eu
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