Last quote by Olli Rehn
Olli Rehn quotes
Latvia's experience shows that a country can successfully overcome macroeconomic imbalances, however sever, and emerge stronger out of the crisis. Latvia is now forecast to be the fastest growing economy in the European Union.
We will return to recovery in the second half of this year and on the condition that decisive policy action is taken in the member states and the european level it should have a more solid and sustainable recovery starting fro next year.
We must do whatever it takes to overcome the unemployment crisis in Europe.
The pace of fiscal adjustment should take into account each country's specific economic situation. In line with this policy, the pace of fiscal consolidation is now slowing down in Europe.
I want to welcome today the political agreement, reached on the memorandum of understanding for the Cyprus programme. And I hope it will be possible to satisfactorily complete this procedure by end of next week.
Ongoing rebalancing of the European economies is continuing to weight on growth in the short term. The current situation can be summarised like this – we have disappointing hard data from the end of last year, some more encouraging soft data in the recent past and growing investor confidence in the future.
This is essential now. Greece has delivered and now it's delivery time for the Eurogroup and the IMF.
It is intended to be a very clear signal that the Euro area is willing and able to tackle the remaining challenges and in this context Europe is standing by Spain.
It is true that the forecasts of the French authorities are slightly more optimistic than ours, in particular for next year. The differences are due to the pace of recovery of investments and exports.
The Commission has full confidence in the determination of the Spanish government to meet the fiscal target in line with the pact. For Spain, the key to restoring confidence and growth is to tackle the immediate fiscal and financial challenges with full determination.
The European economy is estimated to be currently in a mild, but short lived, recession and then subsequently a slow and subdued recovery is forecast to begin from the second half of the current year onwards and continue over the forecast horizon of this year and next year.
Italy is on track to meet its structural fiscal targets for 2012 and 2013, so from that point of view there is no need for new measures of fiscal consolidation.
We are waiting for the French authorities to decide which measures will be introduced for 2013.
We have made significant progress in the recent weeks and months in terms of fiscal consolidation and in terms of reinforcing our economic governance. Now it is time to complete the crisis response by further reinforcement of the euro area financial firewall.
GDP of the European Union as a whole is expected to remain unchanged in 2012 while the euro area has entered into a mild recession.
In the past two years and again this night, I've learnt that marathon is indeed a Greek word. But in the end we came to an agreement.
The talks between the private creditors' community and the Greek government have progressed well and they are very close to an agreement. It is certainly preferable to achieve an agreement in the coming days, preferable to do so in January, rather than in February.
If not, the consequences are clear. In the case of eurozone countries, these countries risk financial sanctions.
We have to continue to work, especially on two fronts, in order to ensure that we have sufficiently credible finance firewalls to contain market turbulence and at the same time we need to further reinforce our economic governance.
This forecast is in fact the last wake-up call, the recovery in the European Union has now come to a standstill and there is a risk of a new recession unless determined action is taken.
While jobs are increasing in some member states, no real improvement is forecast in the unemployment situation in the EU as a whole.
We are not assuming a Greek default. We see that it is essential to find and agree on a sustainable solution for Greece which implies also a second programme with adequate financing from the private sector, and from the official sector.
Greece is actually in some parts of the economy regaining competitiveness. The export sector is showing some small signs of improvements. It is essential that adjustment continues because unfortunately Greece was living well beyond its means and this needs to be corrected.
If you look at Italy, or to some extent Spain and Belgium, we see that the contagion effect is already in action. So that's why we need to find a sustainable solution for Greece, because this is the source of contagion, and then at the same time we have to reinforce states' financial firewalls and reinforce the capital buffers in the banking system so that we can ensure that credit flows to households and enterprises in Europe.
We have created a Commission task force which works together with member states' experts in order to provide technical assistance for Greece, in order to better use the structural funds for investments and growth enhancing purposes and to better reform its tax administration and improve its privatisation practices.
I'm disappointed that we let this market turbulence intensify because we could have stopped it by having a comprehensive strategy to tackle the crisis decided already at the beginning of the year, and then if we had consistently implemented it.
It is essential to reinforce economic governance further and in this field, I think the most important thing is how can we further improve policy coordination in Europe, so that we can complement the existing strong monetary union with a true and genuine economic union.
I will not go into exact figures at this stage. We know that it is a significant number, and we have proposed a recapitalisation plan in three steps.
If we had acted earlier in the curve, we could have prevented much more of this turbulence and protected the economic growth and employment much better than has been the case. Now we unfortunately see that market turbulence is taking a heavy toll on economic growth and employment. That's precisely the reason why the first and foremost solution in this context is to contain the sovereign debt crisis with decisive action.
In the first place it is the private investors and capital markets that we expect banks to go to for capital. If it's not possible, then member states will need to have national arrangements in place for recapitalisation, and/or restructuring of banks, and then as the third line of defence, we see that the European Financial Stability Facility could be used so that it could provide loans to governments.
The European Commission called for a comprehensive crisis response already this year in January in our annual quarterly survey. In fact we started to work on this already at the end of last year. Then we were criticised by some, and not all the elements of this comprehensive answer have so far materialised, to say the least. But I am certain that we now need a comprehensive strategy to overcome the sovereign debt crisis and banking sector fragility in order to ensure sustainable growth and employment in Europe.
We are not proposing an increase in guarantees but rather we are proposing that we need to make more out of the existing resources, to make them more effective so we can effectively contain the contagion that is going on in the European financial and sovereign bonds market at the moment.
I am not campaigning for this, I do not see any vacancy for the moment.
It is indeed in the interests of Slovakia and the whole euro zone that we can have sufficient financial firepower for our financial backstop, in this case for the European Financial Stability Facility. That is essentially in order to contain this financial market turbulence.
Once ratified, the new EFSF will soon have access to new tools of intervention such as precautionary credit lines and interventions in the secondary markets and recapitalisation of financial institutions under certain conditions.
International policy coordination through the G7 and G20 is of critical importance.
The current state of the crisis is a severely intertwined combination of sovereign debt crisis and banking sector fragilities and we cannot solve one without solving the other. We need to solve both.
No, we are now indeed reinforcing our collective crisis response with these measures we have put forward, including the forthcoming decision on the enhancement of the flexibility and scope on the European Finance Stability Facility.
The essential condition is that the Greek parliament will have to endorse the medium term fiscal strategy and the privatisation programme before the end of June. Once this is done, then the (next payment of aid) will be made in time (before mid-July).
These are a matter of urgency.
I reiterated our commitment to move towards a market-determined exchange rate system that reflects underlying economic fundamentals.
That's important to recall that at the same time the Commission together with the ECB and IMF and the Irish authiorities are working in order to resolve the serious problems of the Irish banking sector.
We are reinforcing economic governance, we are reinforcing economic policy coordination, and preventive budgetary surveillance.
The current state of affairs certainly is not viable and it is really high time now in the EMU to supplement the monetary union with a stronger economic union.
We can say that the EU member states have clearly understood the paramount importance of fiscal consolidation and sustainable public finances. It's important that we combine both fiscal consolidation and mobilisation of economic growth through structural reforms.
There has been a big, big change among the member states in their attitudes on this particular issue and I find that reinforcing preventive budgetary surveillance is really at the heart of economic governance. What is legitimate to expect is that the Commission can analyse and the finance ministers and the eurogroup can peer review the national budgets in terms of broader budgetary guidelines and fiscal balance before they are finalised.
It was a coincidence that some phone calls took place around the same time, it would be underestimating the intelligence of the Europeans to claim that we would not have noticed ourselves that we have a forest fire which we have to contain and that's what we did.
Yes they can and in fact they are necessary because there are several member states of the EU who are suffering from very high levels of public debt and deficits which are as themselves hampering economic development. They may have in the short term, the very short term, some negative impact on growth, but on the other hand these measures are necessary in many countries because they are facing such high public debt levels and moreover this servicing of public debt is crowding out private investment, which is needed for economic growth and job creation.
My view is that prevention is always better than correction, but if prevention and early correction fail then we need to have also concrete instruments, incentives for compliance, such as a broader use of the EU expenditure in order to encourage the member states to comply with the pact.
Well, politics is a matter of will, but it is also the art of possible and this time even though we had very strong will at the same time we have to coordinate several positions of the EU or euro area members states. So all in all, we can move rapidly if there is a need for that, but this must be accompanied with accelerated fiscal consolidation by the countries concerned.
It will have to be reformed and the commission's proposals aim at reinforcing the economic governance and especially strengthening the preventive and also the corrective arms of the stability and growth pact.
There was no pressure and I see the United States of America as a partner and not somebody who is pressurising us.
A European Monetary Fund has various formats in the political debate. We will come up with concrete proposals on Wednesday, the day after tomorrow, and the task force presided by President Herman Van Rompuy will certainly discuss this issue very thoroughly.
Thanks to a substantial package of bold and ambitious measures over fiscal consolidation, Greece is now on track to achieve the target of four percent deficit reduction this year.
We need to learn lessons from the crisis in Greece.
Additional consolidation measures are necessary to ensure that the four percent target of deficit reduction for this year 2010 is met.
The Commission will be on the ground in Athens in the coming days, in the next couple of days, this week or next week, with experts from the ECB and IMF delegates to verify the implementation and results of these measures.
We have serious concerns over the tax fine against the Dogan media group. It is a quite strong sanction and it might not be only a fiscal sanction but also it feels like a political sanction.
Such issues as fisheries and agriculture are sensitive for Iceland, and for the EU. Having said that Iceland already applies more than two thirds of the EU legislation. Thus it meets many of the criteria of EU membership but yes the negotiations may be rather difficult.
I certainly hope that we could soon complete and conclude the process. It is really the moment of truth now and we should all try to settle this before the Council.
I also want to encourage Montenegro to continue to work on strengthening its administrative capacity, the rule of law, as well as tackling organised crime and corruption.
It's an encouragement but not a blank cheque. The ball is now firmly in Croatia's court. Specifically, I will point out two issues. First, Croatia will have to work hard on judicial reform. Second, the restructuring of the shipyards also remains a necessary condition and requires substancial further efforts.
I appreciate the determination of the new government to turn the page and close this chapter. Leave the nationalist past behind and move towards the european future which is ahead of Serbia.
I deeply regret the obstruction by certain politicians in Belgrade in blocking the signature. In my view they have really failed to hear the voice of the Serbian people, who voted last Sunday in favour of Serbia's European future. The invitation remains on the table. We are ready once Serbia is ready.
The Serbian people are choosing between a European future and a nationalist past, and we should today send the very strong signal over (a) European future to the Serbian people by deciding to sign the stabilisation and association agreement shortly.
Turkey faces continual cross-border terrorist attacks from the PKK which is on the EU list of terrorist organisations. The European Union condemns all terrorist attacks and understands Turkey's need for protection its citizens.
Further efforts are needed (in Ankara) to ensure democratic supremacy in civil-military relations, protect the rights of women, children and trade unions, improve the judiciary system and enhance the fight against corruption.
I would expect that we could start these talks in early June. I will, of course, listen to Chief Prosecutor Carla Del Ponte upon her return from Belgrade and take into account the findings of her visit.
We confirm that these negotiations must continue although at a slower pace. There will be no train crash. But there is a slowing down because of the works further down the tracks. However, the train continues to move.
The Commission will make relevant recommendations ahead of the European Council in December, if Turkey has not fulfilled its obligations.
The European perspective is open to Montenegro.
I can only encourage Bulgaria to adopt such constitutionnal changes that will facilitate the completion of the judicial reform and fight against corruption and organised crime.
I trust that this will urge the authorities in other countries of the region, especially Serbia-Montenegro and Bosnia-Herzogovina, to do the utmost to achieve full cooperation with the ICTY in order to locate, arrest and transfer the rest of the indictees, Ratko Mladic and Radovan Karadzic.
The first and foremost priority for Romania is to prepare for the accession of the country to the European Union,especially as regards the implementation of both the remaining legislative work and the implementation of the necessary reforms of the judiciary area and the fight against corruption.
I am glad that Serbia and Montenegro has finally made significant progress in cooperating with The Hague tribunal. So far this year a dozen persons indicted for warcrimes have boarded the plane to The Hague.