Preparation of the Summit of Heads of State or Government of the euro area (7 May 2010) (debate)
President
The next item is the statements by the Council and the Commission on preparation of the Summit of Heads of State or Government of the euro area (7 May 2010).
Diego López Garrido
Mr President, this week, on 7 May, there is going to be a meeting of Heads of State or Government of the euro area, and this is the debate in the European Parliament regarding this important meeting. The aim of the meeting will be to formalise the agreement reached on loans to Greece, the financial support package for Greece to tackle the serious financial situation of this euro-area country, and to reflect on the lessons that can be learned from this situation and these agreements in relation to the future of the euro area and of the whole of the European Union.
What the Heads of State or Government are going to do on Friday is confirm the financial solution that the European Union has given to Greece. In other words it is going to formalise the commitment - which at this stage is a political commitment - made at the meeting of European Union Heads of State or Government on 11 February, a commitment to support Greece in resolving its extremely difficult financial situation.
Therefore, what the Heads of State or Government are going to do on Friday is to present, set out and agree the will of the 15 other Member States in the euro area for Greece to receive this aid, these loans, once its Government has adopted a stringent programme of economic and financial adjustments. They are aimed at ensuring Greece's financial stability and the financial stability of the euro area as a whole, which is something that was agreed politically not only for the case of Greece, but was agreed politically on 11 February in a resolution by the European Union Heads of State or Government.
This is an important decision, politically and historically speaking, because it is essential for the credibility of the euro area and for the external credibility of the whole of the Union from a financial point of view. It is important for the fiscal consolidation required by the Treaties on European Union, fiscal consolidation in the euro area and in the whole of the Union, and it is very important for consolidating an effective and lasting economic recovery in the European Union.
Today Mr Rehn, who is here with us, published the Commission's forecasts for 2010-2011, sending a message of gradual economic recovery for the European Union. The Commission's forecasts confirm that the economic recovery is happening in the European Union and that after experiencing the biggest recession in its history, the European Union as a whole is forecast growth of 1% in 2010 - this year - and 1.75% in 2011.
Therefore, the economic recession came to an end in the European Union in the third quarter of last year and economic recovery has begun. The European Economic Recovery Plan and the decisions made by the Member States have made a clear contribution to this by injecting large amounts of money into the economies of the various countries from the budgets of the Member States and from the Union budget, through the European Economic Recovery Plan. This is one of the reasons why - I will say it again - after going through the worst recession in its history, we are already seeing economic recovery in the Union.
These are the European Commission's forecasts, and undoubtedly the decision to lend to Greece is making a decisive contribution to ensuring that the economic recovery in the euro area and in the whole of the European Union is both effective and lasting.
We believe that the European Union has responded well to the current economic situation, to the economic crisis, by doing everything in its power to respond to the situation. Specifically, we think that it has responded well to the extremely serious financial situation in Greece, because what the European Union has definitely done in recent months has been to take clear steps towards what we have begun to describe as the economic governance or the economic government of the Union. Clear steps forward have been taken. At times they may have seemed slow, too slow, but steps forward have been taken, in any case, in a secure, determined manner, which will culminate on Friday in the meeting of the European Union Heads of State or Government.
We believe that the economic governance, the economic government of the Union needs to have solid foundations. The first of these is taking responsibility for the commitments made, for example when a Treaty on European Union is signed and ratified. The second is solidarity, which is a principle that is at the heart of the European Union and of all of its policies. The third is coordination of fiscal consolidation, coordination in the external representation of the European Union - for example, looking towards the G20 meetings - and coordination for growth and getting out of the crisis. I am convinced that this is what will be said in the document that Commissioner Rehn is preparing on the subject and will present to the Commission on 12 May.
Finally, I would like to say that the economic governance of the Union that is being established and developed, and for which the foundations are being laid in the European Union, requires effective instruments and an element of supervision. I am certain that the document that the European Commission is preparing will refer to this. We need quality in public finances. We need supervision of the financial system, European supervision of the financial system, and in this respect I would like to call on the European Parliament to adopt a financial supervision package as soon as possible. This package should involve the regulations and directives that are being debated here and now in Parliament, and are going to be debated in the relevant committee in the next few days and then in the relevant plenary sitting.
We also need mechanisms to prevent possible crises, and we also need - as I said before - the capacity to have a single voice in the external representation of the Union, and in this case I am clearly talking about the G20 meetings. I think that these are steps that are being taken towards an economic government or governance of the Union; the aid and loans to Greece are part of this, and this is why I believe that the European Union is going in the right direction and has consolidated that direction.
I am certain that the Heads of State or Government will adopt this financial aid package for Greece, which is, in short, as they said in their statement on 11 February, a commitment to financial stability, to the economic stability of the euro area and of the whole of the European Union.
José Manuel Barroso
President of the Commission. - Mr President, I was asked to make a statement to this House ahead of Friday's meeting of the Heads of State and Government of the euro area.
Let me first say a word of condolence for the families of the victims of the violence in Athens today. To disagree and protest is a right of citizens in our democratic societies, but nothing can justify the recourse to violence.
Let me address the financial support package for Greece endorsed last Sunday. Then I will give you some of my views on what needs to be done to prevent a repetition of a crisis of this type.
As regards Greece, a multi-annual programme of fiscal consolidation and structural reform has been agreed by the Greek authorities. This was jointly prepared with the Commission, the European Central Bank and the International Monetary Fund.
The Greek Government has put forward a solid and credible package that will steer its economy on a sustainable path and restore confidence. It is important that we acknowledge the courage that Prime Minister Papandreou and his Government have shown.
Greece will undertake painful efforts, but we all know that there are no alternatives to such efforts.
In return, following the recommendation of the Commission and of the European Central Bank, the coordinated European mechanism for assistance to Greece has been activated. This is an unprecedented act of solidarity, unmatched anywhere in the world.
This assistance will be decisive in helping Greece to get its economy back on track and will preserve the financial stability of the euro area as a whole.
Allow me to stress that the Commission has made sure that the mechanism, whilst being based on bilateral loans, is a European one. The Commission was instrumental in setting it up and will play an important role in its management and implementation.
The Commission is, and will remain, central in assessing Greece's compliance with the package's conditionality. The Commission will also manage the bilateral loans from the Member States.
By the end of the week we will already have a critical mass of Member States that have completed the process to provide those bilateral loans to Greece. It is my firm conviction that the unprecedented financial support given to Greece - EUR 110 billion - and the adjustment programme are an adequate response to the Greek crisis. We have no reason to doubt that it will be firmly implemented both by Greece and by the euro-area Member States.
This view is shared by others who matter. I noticed, for instance, the supportive statement of the past, current and future Chairs of the G20 Finance Ministers, issued just now. Regrettably, not all market players seem convinced already. We have to say loud and clear that the doubters are wrong. I will come back to this in a moment.
At the meeting of the euro-area Heads of State and Government on Friday, we will look beyond this deal to what we need to do to draw the right lessons from this situation. The debate will of course be a starting point, because decisions need to be debated further and ultimately taken with all the 27 Member States - the euro-area Member States but also all the other Member States of the European Union. Let me say this very clearly: discussing and taking decisions at 27 is a source of strength.
Whilst we have to speed up our processes, the fact is that the joint action of the 27 - unparalleled anywhere in the world - provides the best possible foundation for our joint future in an ever more interlinked world.
I see two main strands for reflection and action: first, a reassessment of the rules for economic governance, including the Stability and Growth Pact, and second, financial markets reform.
The Commission has been working intensively on economic governance and is ready to present its proposals on how to improve this next Wednesday. There are three main building blocks to be considered. First, responsibility: we need to reinforce the Stability and Growth Pact and, above all, Member States' compliance. The case for reinforcement of both the preventive and the corrective arm of the pact is obvious. I am pleased that most of those who have previously questioned - or even suggested weakening - the pact now accept the need for stronger rules and - most importantly - for their strict implementation.
Second, interdependence: we are all in this together. I think the crisis has clearly shown that we need to address the imbalances between our Member States, in particular within the euro area. This includes divergences in their competitiveness, as this is one crucial element that causes other types of imbalances.
This cannot, of course, mean that some become less competitive so that others look relatively more competitive. We are all competing on world markets. What we need is to enhance our overall competitiveness in a balanced, mutually reinforcing way. I also believe we need to look at the other causes of imbalances. To make progress, we will propose increased surveillance and increased economic policy coordination. I am also happy that I see more openness now when it comes to the Member States for this purpose.
Third, coherence: we have to ask ourselves whether our system of fiscal rules is complete. I see merit in creating a permanent mechanism for dealing with disruptive situations. After all, it is better to be safe than sorry.
I hope that we can seize the moment - and I count on you to help us deliver these reforms. I believe from a political point of view that, in terms of European integration, we are at one of those moments where, if we do not build up Europe, we will fall behind. We cannot have a standstill. It is a very special moment, the moment we are living today in Europe where our solidarity, our responsibility, is being tested every day. I hope the leaders of our Member States will be able to rise to the occasion, not just to help the others but to show their responsibility to our common European project.
These reforms will be introduced against the background of unprecedented efforts already under way. That deficit and debt levels in some Member States need to be corrected with determination, and faster than targeted before the crisis, is undisputed.
But it must also be said that we cannot ignore the fact that the budgetary deterioration in 2009 was largely due to the working of the automatic stabilisers in the face of an unprecedented decline in economic activity caused by a financial crisis not originating in Europe. In other words, the overall situation in the euro area was largely the result of anti-recession policies advocated all over the world.
It was always clear that the situation would subsequently be corrected, and most euro-area members have already undertaken bold reforms, for example of their pensions systems. The responsibility shown by the governments needs to be matched by financial-market players. This is why it is no less urgent to continue delivering a sustainable and responsible financial sector, at the service of the economy and its citizens.
One must bear in mind that financial-market players are key actors in driving market sentiment. Psychology also matters in markets. The financial crisis was born out of short-termism, pro-cyclicality and a lack of responsibility. That is what we must urgently correct.
We need strong and stable European financial services markets to deliver the investments needed for future growth in line with the Europe 2020 vision. We need responsible behaviour from all our market players. We have already been doing a lot as regards financial markets reform. I count on this House to make this clear to all.
European institutions are acting, and must be seen as acting together: Parliament, the Council and the Commission. We have prioritised work on responsible risk management, safer derivatives markets, better financial supervision and ensuring that banks hold adequate capital to cover their real risks. This work must be speeded up.
In the coming weeks we will need to complete the reforms already under way. As I said to this House only two weeks ago, I hope to see a breakthrough soon on our proposal for hedge funds and private equity.
I would also like early agreement on effective new European supervisory arrangements. The European Systemic Risk Board and the three supervisory authorities should start working at the beginning of 2011.
But they must not be mere paper tigers: we have a shared responsibility to ensure they have the tools they need to do their jobs. This includes binding decision-making powers to deal with genuine emergencies, to enforce European rules - and I insist on European rules, not only national rules - and to settle any disputes within the colleges of national supervisors. It is high time to deliver these decisions and make sure they are ambitious.
More proposals are on their way this year to improve depositor and investor protection, to strengthen measures against market abuse, to further improve the quality and quantity of bank capital and discourage excessive leverage.
Over the past three months, and paradoxically still this week, the situation on the sovereign debt markets has brought new concerns to light. The Commission is already working on a fundamental overhaul of derivatives markets to increase transparency and safety in these markets. In a first stage, we will present legislation to standardise eligible derivatives contracts, putting them through central counterparty clearing that is properly regulated and supervised. We are also now considering whether further specific measures are needed for sovereign derivatives markets.
The crisis has also once again brought the role of credit rating agencies to the fore. These agencies play a pivotal role in the functioning of financial markets, but ratings appear to be too cyclical, too reliant on the general market mood rather than on fundamentals - regardless of whether market mood is too optimistic or too pessimistic. Because credit rating agencies have such a key role and influence over the markets, they also have a special responsibility to ensure their assessments are both sound and comprehensive. That is why in 2008 the Commission quickly put forward new legislation for these agencies, which will come into force in the next few months.
These rules will ensure that credit rating agencies act more transparently, publish their methodologies and avoid conflicts of interest, but we need to go further. To strengthen the supervision of these actors of Europe-wide dimension, the Commission believes they should be put under the direct supervision of the future European Securities Markets Authority, and that is exactly what we will propose.
We have also launched a reflection on whether further measures may be needed to ensure the appropriate rating of sovereign debt in particular. We must get our own house in order while pushing others to do the same.
The Commission will do whatever is necessary to ensure that financial markets are not a playground for speculation. Free markets constitute the basis for the functioning of successful economies, but free markets need rules and compliance, and rules and compliance need to be tightened if irresponsible behaviour puts at risk what cannot and should not be at risk.
Market behaviour must rest on sound and objective analysis, and financial services must realise that they are exactly that: a service, not an end in itself. They must not become detached from their economic and societal function. In fact, financial-market players are still in business because regulatory authorities and democratic institutions - ultimately the taxpayers - stabilised the markets in the financial crisis.
We acted swiftly then, and precisely for that reason, we will also act swiftly in the future. So the message from this Friday's meeting of Eurogroup Heads of State and Government should be clear, and it will be clear: we will do what is needed - on all fronts.
President
We would like to add our voice to the condolences which Mr Barroso has expressed in his speech. The events of which Mr Barroso was speaking took place today in Greece. We have high hopes that the impasse in Greece will be broken. The recent problems there arouse the concern and interest of all Members of the European Parliament.
Joseph Daul
Mr President, ladies and gentlemen, we in Europe are going through a particularly difficult period with the serious crisis in Greece, its consequences for the citizens and, as you pointed out, tragic and dramatic consequences, with the debts that are piling up in most of our Member States, and with a European response that does not always live up to our hopes, but which at least exists.
The time has now come for Europeans to learn lessons from these events and to call for radical reforms of European governance. Reforms that will ensure that our Member States stop taking decisions on their own, without consulting their partners - with whom they do, after all, share a currency, values and, hence, a common destiny - about their budgetary priorities, their fiscal priorities and their social priorities. Reforms of people's mentalities, so that our parties, our ministers, our national colleagues stop systematically denigrating the decisions taken in Europe, when they themselves have been party to those decisions.
Can we in fact continue any longer to call for solidarity from our partners when we face difficulties and totally ignore them when things return to normal? Can we continue any longer to call for substantial aid from our partners without being able to guarantee absolute transparency in the presentation of public accounts? Lastly, can we continue any longer to be surprised that questions keep being asked when we call for solidarity among peoples of whom some work 35 hours and retire before the age of 60, and others work 48 hours and retire at the age of 67? I do not think so. On the contrary, I believe that the time has come to ask the real questions and to provide the real answers to those questions.
These answers are not, for the most part, national, but European in the world in which we live. These answers are not about courting popular opinion, but about being responsible and sensible. These answers are our responsibility; we must provide them without hesitation, or else they will be imposed on us more quickly than we think. Not only will our peoples be able to accuse us - and rightly so - of having failed to do our duty, of having failed to tell them the truth, but they will also have to put up with decisions that are even more painful than the ones that have to be taken today. We must call very explicitly for an economic Europe, a social Europe and a fiscal Europe, something which requires very practical measures on the part of our governments, on both the right and the left.
Will this argument be heard by the Council? Will we be able to ensure that it is heard loud and clear? I put the question to Mr Verhofstadt, who has some experience of this Council. Does he think it is possible to enter into discussions, together, within the Council? Will this argument be taken up by the Commission? I hope so, and I strongly urge you, Mr Barroso, to take it up: I ask you, as guardian of the Treaties, to ensure that the decisions that we take are well and truly applied by the Member States. I note, with regard to the Services Directive, for example, that this is far from being the case. This is a lost opportunity, in terms of growth, which we will no longer be able to allow.
Ladies and gentlemen, I am not an idealist. I do not consider myself naive, but I do believe that the moment of truth has arrived for Europe, and I propose that we rise to these challenges with courage, with a sense of responsibility, just as Europe's founding fathers, those founding fathers of Europe who had no hesitation in taking courageous and visionary decisions - Schuman, De Gasperi, Adenauer and the others - did 60 years ago. We must follow their example: they did not wait; they did not hold a referendum. They seized their political courage with both hands to respond to the crucial issues that arose.
Ladies and gentlemen, the crisis that we are going through may be a good thing if we have the courage to take the right measures, but it may be very serious if we avoid the necessary reforms. We urgently need economic and social governance; we urgently need an adaptation of the rules on taxation. Lastly, we need to guard against creating an artificial gap between the Member States of Europe and the others. European solidarity applies to every one of the 27 countries. I call on you, Members of the Council, to see Europe as it really is. I call on you to carry out studies on what will happen to us if, tomorrow, France and other countries encounter the same difficulties as Greece. What will become of our euro? What will we be able to do for our European citizens?
Thank you for your attention. We share this responsibility jointly, and time will not stand still for us.
President
I notice that one of our Members, Mr Madlener, has asked to speak under the blue card procedure. However, I already have you on the list of speakers. I have, here, Barry Madlener as a speaker. I will give you the floor in a few minutes. I promise you will be able to speak.
Maria Badia i Cutchet
Mr President, first of all allow me to express, on behalf of the Group of the Progressive Alliance of Socialists and Democrats in the European Parliament, our complete solidarity with the Greek people following the deaths that have taken place today. I would also like to call for a return to calm and say to the Greek people that we are on their side and that they have our support in the efforts that they are making in this long and difficult trial that they are facing.
I would also especially like to address the Prime Minister, Georgios Papandreou, and encourage him in his firmness and political courage and in all the hard work he is doing to save the future of his country.
In the months and years to come we hope that the European Union will do everything it can to support the reform processes that are necessary. We cannot continue to simply play a monitoring role. The European Union must play a part in the reform and support it. The success of the transformation process must be a joint success for everyone in a united Europe, invoking a common destiny. In order to achieve this, we must ensure that the European and fiscal instruments are adequately mobilised, providing all the help and assistance that we can during this difficult period.
Moreover, beyond the Greek crisis, I think that we can conclude that the last few weeks have been very illuminating. We must use everything that we have learnt to strengthen economic governance and build a European Union that is not only monetary but also truly economic. Something that was inconceivable at the time of Jacques Delors has now become inevitable, and we must measure up to the demands of our times.
In order to achieve all of these ambitious objectives, we must first learn to work together. The Stability and Growth Pact is one of the elements that has most demonstrated the need to coordinate our economic policies. The coordination of our economic policies must be active and effective, and focused on processes of sustainable, strong growth that is shared by all and will guarantee jobs. We hope that the European Commission will soon put forward brief proposals in this respect that go beyond just repressive logic. We must learn to build and grow strong together.
President Barroso, I hope that you understand the urgent need to make maximum use of the role that the Commission can play in this phase.
Secondly, we must equip ourselves with the mechanisms that we need to tackle a crisis. It is high time for the Council to approve the establishment of a European financial stability mechanism, a proposal that was adopted in March by the prime ministers and leaders of the Party of European Socialists. We must condemn the aggressive and speculative attitude of some financial agents, but we must also understand that we have designed a monetary system that is insufficient in times of crisis.
Thirdly, we must develop a new concept of European solidarity. Either we move towards a common destiny, or we must resign ourselves to succumbing to the negative dynamic of national selfishness and destructive competition between ourselves. We cannot say that we want to live together while at the same time saying that in practice we each want to act independently. The current crisis is an acid test, and we must understand its full significance.
Fourthly, we need to attach the necessary importance to the financial sphere. The coming weeks and months will be an opportunity for Parliament to take a position on a series of very important legislative proposals, such as hedge funds and financial supervision.
I call on all the institutions to support us in this responsible approach, in order to guarantee that Europe quickly establishes a solid regulation and monitoring system. We hope that by working together we can also create a tax on financial transactions, so that the financial entities make a fair contribution to the economic effort that every one of us has had to make.
The future of Greece will largely depend on the growth of its neighbours - us - as we are its main economic partners. If we are not capable of tackling the challenges that have already been set in the 2020 strategy, if we are not capable of fleshing out a common political agenda and if our economies are condemned to slow growth, with few employment opportunities, we will not be able to prevent further attacks that could be even more serious and difficult to manage.
The future of our continent is at stake. The future of Europe depends on our intelligence, our solidarity and our firmness.
Guy Verhofstadt
Mr President, allow me to start by telling you that I hope, as I believe do all my fellow Members and the President of the Commission, that the system that we have put in place will work. I have had my doubts since the start and have criticised the system of bilateral loans, but that does not mean that I do not hope that it works and stops speculation against the euro.
For, little by little - ladies and gentlemen - there has been speculation against the euro and an attack on the euro, and not only an attack on Greece or an attack linked to the state of the public finances in Greece. This is therefore far more serious and more widespread. I for my part hope that this system, once formalised on 7 May, will be able to fully achieve its objective, for the simple reason that we have no other instrument. We have no other instrument. Therefore, this system has to work, and it has to be supported.
However, it is also important - and this is my second point - to clearly understand that, in the near future, it will not be possible to resort to it at every turn. A structural mechanism will have to be provided as soon as possible; perhaps not for the next few months but certainly for the next few years, because we are going to encounter such situations again. Moreover, if we want to have access to a structural mechanism for the future, we have to bear in mind one thing: lessons need to be learnt from what has taken place over the last five months. We needed five months to put a mechanism in place: three months to decide on its principle, then two months to decide on its conditions. Why? Because this is an intergovernmental system!
Once again, I believe that the first lesson to be learnt for the future is that we must follow the Commission in its Community approach. For the Commission had proposed a European loan: it could have been approved immediately in December or January and could already be having an impact today and stopping this speculation against the euro.
I therefore hope that, on 7 May, the first decision, the first lesson to be learnt from what has happened over the last five months will be that we say - in the hope that this works - that we are now going to ask the Commission to propose a European loan that can stop speculation against the euro immediately. For the European Union's entire credibility and liquidity rests on such a proposal, which is not the case in an intergovernmental system, where 16 countries must say 'yes', 16 parliaments, perhaps, must say 'yes', and so on.
I also hope - although Mr Rehn has already begun to make proposals - that the second lesson that we learn from all this is that we need to introduce a number of structural reforms, namely a preventive chapter in the Stability and Growth Pact - which Mr Rehn has proposed - a European monetary fund, a structural mechanism that can be used straight away and, thirdly, a 2020 strategy that is far more robust than the strategy that is down on paper today.
Then, we also need reform with regard to the rating agencies, even if the latter are like weather forecasts: either they are too flexible and we want them to be slightly more inflexible, or they are too inflexible and we want them to be slightly more flexible. However, a European-level initiative is definitely a good idea that must be looked into.
Lastly - this is my last point, Mr President - I call on the Spanish Presidency to agree to financial supervision very quickly. I am sorry, Mr López Garrido, but it is not us who are to blame, but the Council! Am I not right in thinking that it was the Council that changed the Commission's proposals? There were some Commission proposals that I even criticised, but they still went much further than those of the Council. We are the ones who are redoing the Commission's work for the moment, and I have a worthy proposal to put to you.
If you want financial supervision and the proposals to be applied within a month, then approve straight away, with the Council and Ecofin, the amendments that Parliament is going to table to you in the next few days. It will take no time at all to approve them, and financial supervision will be applied. I hope that you will be able to relay this information to your Ecofin colleagues, who have merely outlined, in their proposal, a system for avoiding the financial supervision that was established by the Commission.
Daniel Cohn-Bendit
Mr President, ladies and gentlemen, I am going to continue somewhat along the lines of Mr Verhofstadt's speech. It is clear that we have been drifting for four months. It is clear that we have made mistakes. It is clear that, by drifting, we have given impetus to the markets and to speculation. Those Council Members who are responsible should at least admit it! They should say: 'We are to blame! It is us! It is our fault!' Mrs Merkel, Mr Sarkozy, I do not know what they are called or what they do in life, but everyone could read it in the newspapers: action needed to be taken straight away. That is my first point.
Secondly, I would like one thing to be understood at least, and that is that the task facing the Papandreou government is nigh on impossible. I call on Ecofin, on the Heads of State or Government, to realise that their countries are incapable of implementing reforms. How much time does France need to reform pensions? How much time does Germany need to build up pensions? Now, Mr Papandreou is being asked to change everything in three months. You are completely crazy.
The events currently taking place in Greece prove it. Greece - rather, Mr Papandreou - is not being given the time to achieve a consensus in Greece. No one identifies with the State in Greece. The policy is one of every man for himself, which is regrettable, and decades of political corruption in Greece are also responsible for this situation. What must be created, however, is cohesion. It must be created, it cannot be decreed!
You in Spain will see what happens if you have problems, and those in Portugal will see what happens if they have problems. Mr Barroso knows something about this, since he lost elections in this way. Therefore - no, he never lost an election - what I mean is that we must have a sense of responsibility and that we must not ask for the impossible. I have the impression that, at one time, people would say, people would hear: 'I want my money back'. Now, I have the impression that, at government level, it is a case of: 'I want to make money on the back of Greece'. For that is also the problem: by borrowing at 1.5% or 3% and lending to Greece at 3%, 5% or 6%, money is being made on the back of Greece. That is unacceptable!
Besides, Europe can take initiatives. Mr Verhofstadt is right when he talks about a European monetary fund, about an investment and solidarity fund in order to raise a European loan. The Treaties must be amended. Well, ladies and gentlemen, we in this House have the opportunity to take an initiative to amend the Treaties. Let us not wait for the Council; it is incapable of reaching a decision. Let us take the initiative, a common initiative by this House to amend the Treaties, so that, at last, there is a European monetary fund that can actually combat speculation. We can do it; yes, we can. Let us do it.
Now, I would like to say something about the way in which the events in Greece are being managed. I call on the Commission to involve the Directorate-General for Employment in the management efforts so that we can also gauge what is happening in Greece. I call on the Council to tell the IMF to involve the International Labour Organisation in the management of the events in Greece, because these are human beings we are talking about. There are employment problems, there are employees. I believe that it should not just be finance, but also security and the ILO or the Directorate-General for Employment, that dictates. The latter would counteract the madness that sometimes characterises those who take decisions on the basis of purely financial considerations.
I have one last point. There is a way of shoring up the Greek budget, and it is simple: the European Union should take an initiative aimed at disarmament in the region. In other words, a political initiative between Greece and Turkey aimed at disarmament. In other words, a political initiative to have the Russian troops ... the Greek troops ... the Turkish troops - excuse me - withdraw from Northern Cyprus. Let them disarm. I will say one thing: people are, nonetheless, hypocritical. In the last few months France has sold six frigates to Greece for EUR 2.5 billion, helicopters for more than EUR 400 million, and some Rafale jets (one Rafale jet costs EUR 100 million). Unfortunately, however, my spying efforts do not allow me to say whether it was 10, 20 or 30 Rafale jets. That comes to almost EUR 3 billion. Then, there is Germany, which has sold six submarines to Greece in recent months for delivery over the next few years. They come to EUR 1 billion.
Yet this is completely hypocritical. We are giving them money to buy our weapons. I call on the Commission to give an account here, in the European Parliament, and at the Council, of all the weapons sold by Europeans to Greece and Turkey over the last few years. Let there be some transparency at least. Let us know! Well, I tell you that, if we are going to act responsibly, we must guarantee Greece its territorial integrity: Greece has 100 000 soldiers, more than 100 000! Germany has 200 000. This is completely absurd: a country with 11 million inhabitants has 100 000 soldiers! Let us put that to Greece. It may well be more effective than cutting the pay of someone who earns EUR 1 000. This is my request to the Commission: be a little fairer.
(Applause)
Derk Jan Eppink
Mr President, as a born anti-revolutionary I shall be speaking with rather less passion than Mr Cohn-Bendit, but I understand now why 1968 was a success for him; I could only follow events on television as a child.
Ladies and gentlemen, I share the concern of the European people about current developments. Savers and pensioners, for example, are asking themselves where this is heading. The question and the concern are both legitimate. A EUR 110 billion package is an enormous amount of money.
We first talked about 35 billion, then 60 billion, and now 110 billion. This is a huge sum, and the austerity package in Greece is also huge; yet we must not forget that Greece has lived on credit for too long, with a retirement age of 53 years. Who would not want that? The question is whether or not Greece will come out the other end. We are now seeing strikes, rebellion, rioting and so on. This makes the Greek problem a European problem, our problem.
The problem in Athens, Mr Cohn-Bendit, affects the Dutch, Flemings, Germans - all of us - and the contamination risk remains. I take the view that Greece should have been thrown out of the euro area once the budget misappropriations were discovered. We should have set a cut-off point, but we failed to do so and now we have to continue and hope against hope for success.
We must also rewrite the rules of the Stability and Growth Pact. It is providing neither stability nor, at present, economic growth. In my opinion, supervision must be strengthened, the European Commission must show more courage and there must be greater monitoring of compliance with the rules. This has been absent in recent years.
As I see it, however, we also need an exit procedure for countries that can no longer cope in the euro area. We have an exit procedure for the European Union but not for the euro area, and I believe we do need this option, so that a country may introduce and devalue its own currency to get itself back onto dry land. Why is there an exit procedure for the European Union itself, via the Treaty of Lisbon, but not for the euro area?
Commissioner Rehn told me last time that a country's departure from the euro area would run counter to the ever closer union, but Greece is currently demonstrating where the limits of this ever closer union lie. Suddenly we have a weak euro and a low growth rate. Ladies and gentlemen, we are held captive by the theory of the ever closer union. We are holding European taxpayers to ransom, and those taxpayers are becoming more uneasy with each passing day; this should not be forgotten.
Lothar Bisky
Mr President, ladies and gentlemen, we must, of course, provide assistance to Greece. However, the so-called rescue operation also has some absurd elements. With France and Germany acting like great powers, the process of reaching a decision on the assistance package was very expensive and protracted.
For years, the financial markets have been increasingly deregulated and now everyone is surprised that it is expensive. Who will now pay the price for the political errors? The workers, ordinary citizens? Banks are not being placed under any obligation. No, once again it is the taxpayers who are to pick up the tab and dig deep in their pockets to pay for the profiteering of the banks. Once again, dependent workers are to have to accept pay cuts. With the dictates from the International Monetary Fund, any semblance of a democratic decision-making process has been eliminated.
In the case of the oil slick in the Gulf of Mexico, application of the polluter-pays principle has been called for. I believe that is right. Anyone who digs for money or gold should also be responsible for the damage in cases of doubt. At the moment - at least in Germany - banks do not even have to pay back the debts that they have taken on and with which they are happily speculating against the euro - yes, against the euro. Furthermore, they are still speculating, even though we have been saying for a long time that something needs to be done about this.
Proposals for what could be done are on the table. A ban on trading credit derivatives and on short selling, the introduction of a financial market transaction tax, special levies on bonuses in the financial sector, a legally binding bank and insurance levy - all of these proposals are on the table. Of course, Greece must also do its homework. Like other countries of the European Union, Greece should also tax wealth, combat corruption and reduce its arms expenditure. Mr Cohn-Bendit has already spoken very convincingly about this. I will therefore omit the facts in this regard and endorse what he said in his speech.
I can understand people in Athens going out into the streets and protesting. What I cannot understand is the violence. I agree with everyone who has expressed sympathy for the victims, whose suffering is most regrettable. Violence will achieve the opposite of what the protesters and honest demonstrators want. We must call for an end to the violence.
Nikolaos Salavrakos
Mr President, thank you very much. We are trying to make the numbers look good and it is a well-known fact that, when the numbers look good, the people are unhappy. We need to strike a balance; we need to balance the figures and we need to keep the people happy.
As a result of this unorthodox behaviour, Greece is mourning three victims today, the death of three workers as a result of aggressive protests by other workers. Throughout Europe today, the economic crisis which came at us from the other side of the Atlantic and which is tending to be worse over here, is heaping scorn on politics and politicians.
In Greece, the grassroot sections of society are very badly disposed towards politicians: there are 300 members of parliament in Greece and I hear the beat of Greek society drumming out 'hang all 300 of them'. These are dangerous times. I read about the same things and about the same scorn for politics in other Member States of the European Union; we all know about this, just as we all know that we need to maintain democracy.
This being so and with these thoughts in mind, because I have no time to expand further, what I want to stress is that the leaders of tomorrow will need to move more quickly and in the direction of a more permanent solution for more states. Greece is one of them; it is the tip of the iceberg. However, there are other Member States - both inside and outside the euro area - facing economic problems which will worsen over coming months.
President
Mr Salavrakos, I did not interrupt you because you are Greek and your words are very important to all of us.
Barry Madlener
(NL) Mr President, I should like to address in particular Mr Verhofstadt, Mr Daul and Mr Schulz - he is not here at the moment, but I address his group, the Group of the Progressive Alliance of Socialists and Democrats in the European Parliament - as they were partly responsible for the problems. They say solidarity is needed. Let me remind you that Greece has been the largest net beneficiary of European funds for years. This has resulted in the country rigging the game, and you have been only too willing to be taken for a ride, as you are all so Europhile and crave European enlargement so much that you have ceased to be critical altogether, and now we are left holding the baby.
I do not know if you remember that Spain - the country that is next in line - has legalised two million illegal immigrants in the last 15 years. You all thought that was great, but now Spain has 20% unemployment and it, too, is in deep trouble, as is Portugal. These are all countries with socialist governments that you have supported with European funds for years and which have made a mess of things by living beyond their means. Year after year you have looked on, year after year you have approved this, and now we, the citizens, are having to pay the price. You should be thoroughly ashamed.
The only solution - which I have not heard anyone mentioning here - is that we now be tough on Greece. The country must reintroduce the drachma, as its membership of the euro area is untenable. If Spain is next, it simply reintroduces the peseta, and likewise Portugal the escudo, and then they will be able to compete again. This Europe is faulty, and northern European citizens will soon refuse to pay any more for your mistakes and for the lax socialist governments in these countries. After all, to reiterate, Greece, Spain and Portugal - all socialist countries - have all received European Union funds. Immigration has run riot whilst you have looked on and done nothing.
Stavros Lambrinidis
(EL) Mr President, thank you. I should like to comment on something which Mr Salavrakos said earlier about the three people, the three workers, who were killed in Athens today by three other workers. There is absolutely no excuse for this. These people were killed by murderers, by criminals. Workers held a massive peace rally in Athens today. They did not kill anyone. The real criminals were condemned by the Prime Minister, Georgios Papandreou, and all the political parties in Parliament just a short while ago. It is a great mistake and it is dangerous to confuse peaceful protests and criminal acts such as those committed in Athens. They are condemned by everyone, they do not speak for Greek workers and they do not express everyone's conviction that, if we unite as a nation, we shall get the country out of the crisis.
President
I would not like to get involved in a discussion about this. However, please allow me to say that all of us in this Chamber - all Members of the European Parliament, and I am sure this also includes the President of the Commission and Mr López Garrido on behalf of the Council - would like, once again, to express enormous solidarity with the Greek nation. They are our friends, and we know what great responsibility there is on both sides of the conflict which is taking place in Greece. It is a huge responsibility.
I would like to tell you all that I, too, have experienced that responsibility, and that I have experienced it from both sides. I was a member of a trade union and an activist, and was very active for many years. I have also been the head of a government, and I understand the difficult situation which exists, today, in Greece. We all want to show solidarity and to express our deepest sympathies, above all to the families and friends of the victims. It is natural that we want to do this, and we consider it our duty in the European Parliament. Thank you for the responsible debate which we have had, today, in this Chamber.
Written statements (Rule 149)
Ilda Figueiredo
We are experiencing a serious situation. There is an obvious lack of solidarity of the European Union's leaders - Germany's in particular - regarding the agreement on Greece's situation. Above all, they are taking political control of the country, whilst forcing the Greeks to regress decades in social terms. This calls into question all the principles that they have always proclaimed of social and economic cohesion, convergence, solidarity, and the so-called European social model.
As is being well shown by the struggle of the workers and working classes in Greece, it is unacceptable to require the Greek Government to put their fundamental rights at risk. This is being imposed in exchange for a loan at a rate of interest higher than that of the International Monetary Fund itself. It seems there are no limits for the leaders of the euro area. They have gained from Greece's fragility, and now they are imposing their imperial position of absolute domination of the country's internal policies in exchange for a loan on which they will also gain from the interest.
This decision must be changed at the next summit. The leaders must opt for a non-refundable grant from the Union's budget, either on an extraordinary basis, or financed by future Union budgets. The richer countries in the euro area must adopt the principle of economic and social cohesion once and for all.


10. EU protein deficit (
Martin Häusling
Madam President, ladies and gentlemen, this report examines how the 80% protein deficit in the European Union can be reduced by promoting the cultivation of protein crops in Europe. The point of the report is not to instigate a debate on the question of zero tolerance, Nor does it aim to make it easier to import genetically modified soya. I would therefore implore you to vote against paragraphs 3 and 9. These amendments would lend the report a completely different character. If these two items are accepted, I shall have to withdraw my name.
Martin Häusling
(DE) Madam President, because the outcome of the vote has been to alter the report, I would ask you to have my name removed from the document. I wish to hand back the report.
(Applause)


Adoption by Slovakia of the single currency on 1 January 2009(debate)
President
The next item is the report by Mr Casa, on behalf of the Committee on Economic and Monetary Affairs, on the proposal for a Council decision in accordance with Article 122(2) of the Treaty on the adoption by Slovakia of the single currency on 1 January 2009 - C6-0198/2008 -.
Ladies and gentlemen, let me congratulate Slovakia and our Slovak fellow Members on this success for their country and for the euro area.
Vladimír Špidla
Madam President, on behalf of the Commission, I would first like to thank the Committee on Economic and Monetary Affairs and the rapporteur, Mr Casa, for the excellent work they have done in assessing Slovakia's fulfilment of the convergence criteria for adopting the single currency.
With Slovakia's entry into the euro area, this will have sixteen members, four of them from the group of countries that joined the European Union in 2004.
This is the fifth enlargement of the euro area since the single currency was introduced in 1999. It is clear proof that it is open to all Member States meeting the conditions set by the Treaty.
Slovakia's entry into the euro area represents the crowning of the remarkable progress made by the Slovakian economy over the last decade. It will enable the country to benefit from the important advantages offered by Economic and Monetary Union, as set out in the report adopted by the Commission last May on 10 years of EMU.
This report also demonstrates that, to benefit fully from the advantages of the euro, it is necessary to pursue sound macroeconomic policies to protect a country's competitiveness once the exchange rate is fixed irrevocably. This includes fiscal discipline, a responsible wage policy and structural reforms, particularly as regards the functioning of the labour market.
Without a clear commitment to this, there is a danger that inflation could become a real and considerable problem. This point is mentioned explicitly in Mr Casa's report, with which the Commission is in complete agreement.
The Ecofin Council of 3 June approved the Commission's report on Slovakia's fulfilment of the convergence criteria. The European Council meeting in Brussels on Thursday and Friday should, once Parliament's opinion has been received, confirm the political support for Slovakia's adoption of the single currency, which will be validated by the Ecofin Council in July.
Next week, the Commission will propose the definitive exchange rate between the Slovakian crown and the euro, which will also be formally adopted by the Ecofin Council in July.
In this respect I would like to thank the Committee on Economic and Monetary Affairs and Mr Casa for the work begun some months ago to enable Parliament to give its opinion within the tight deadlines that our three institutions are given to make a sound assessment of the fulfilment of the criteria by the Member State concerned, and to leave it enough time to complete the practical arrangements for adopting the euro on 1 January 2009.
David Casa
We have an important moment ahead of us because in this Parliament we are once again discussing the enlargement of the euro area to include an ex-Communist country, a country that, like my own country, Malta, joined the European Union in 2004, a country that needed to change its economy in order to be able to meet the criteria laid down in the Treaty. This was not easy to achieve. We have been in discussion for months with the Commission, with the European Central Bank, with the Slovak Government as well as with the whole of Slovak civil society to ensure that the process can truly help Slovakia to meet all the criteria laid down in the Treaty.
After the Commission issued its report, we, as Parliament, went through a process of discussion and consultation that was truly a very important moment, even for me, because I could see what the Commission was saying, not only what the European Central Bank or the Slovak Government were saying, but I could understand from the Slovak people how they perceive this historic step that they will take, God willing, next January.
As the Commissioner stated just before me, today Slovakia has a responsibility, because there is a queue of countries behind it, the majority of which, like Slovakia, are emerging from a Communist era and wish to enter this area that is so important for the European Union. Therefore, the country that we are talking about today has a responsibility to remain durable as regards convergence, and especially as regards the inflation rate that was the subject of much discussion even in my report. However, from the statistics we have before us today, it is clear that we have a problem throughout the area and we cannot single out Slovakia, because today we are talking about an inflation rate that actually increased in the 21 countries of the European Union. Therefore, we must not only ensure that Slovakia maintains a durable inflation rate, but also see how the inflation rate can be reduced as much as possible in all the countries already in the euro area. We know about the problems that we are currently facing, the oil problem that is not affecting us in a positive way, and we therefore have to consider how we are going to tackle this very important issue.
As I said, Parliament has visited Slovakia for the first time and I would appeal that delegations from this Parliament are sent to each country that is going to enter the euro area because this provides an opportunity to hear and learn more about how the economy is really faring in that particular country.
As for the Commission, I am slightly disappointed with the reassessment it carried out after the convergence report was officially published. I do not think that this Parliament should be treated in the way the Commission treated it because we should at least have been consulted. I understand that the reassessment cannot be published very far ahead because of the possibility of speculation, but this Parliament requires that when similar measures are taken after the convergence report has been compiled, we as Parliament should be consulted, even if it is not until the last moments of this decision.
In closing I would like to thank all those who assisted me in preparing this report, including the shadow rapporteurs from all the political groups, my coordinator and the committee chairs, who were always very cooperative on this report. Lastly, I thank the Slovak people and wish them well with this historic step they are now going to take. We should vote in favour of this important step, not only for their sake, but also for the sake of the whole of the European Union.
Alexander Radwan
Mr President, ladies and gentlemen, I, too, would like to thank the rapporteur. I have been having a few additional thoughts about Slovakia's accession to the euro area over the last few days.
The Group of the European People's Party (Christian Democrats) and European Democrats will be voting in favour of this report. Based on the events surrounding the change from the koruna to the euro, we again submitted relevant amendments and compromise proposals because this change, which was more than the allowable 15% fluctuation, led to a dispute in Parliament too. All we can do is ask of the Commission - and not just ask, but actually insist - that it helps out here so that for future adoptions of the single currency, the criteria that are already laid down in the Treaty will be made specific.
Since becoming a Member of the European Parliament, I have been present every time a new country has adopted the single currency. Each time, we have been presented with new arguments, including the one that 'after all, the previous states were able to do it this way too', and this will become a neverending story. I consider it important that we see joining the euro area less as a matter of national honour and more as a goal of making the criteria more objective, which is good for the state that is joining.
The upward revaluation of the koruna by more than 17% is certainly economically justified. Whether it was right to combine the timing of the revaluation with entry to the euro area is another matter. Therefore, we should do everything possible to ensure that the euro and the overall economy achieve something good, rather than restricting ourselves to the point of view of a political situation of limited duration, whether European or national.
Let me mention briefly what happened on Thursday. I think it is wrong for the European Parliament to ignore this repeatedly, and we will have a major debate about this tomorrow. We will vote today on whether Slovakia should join the euro area and ECOFIN will do so in July. We saw on Thursday how one member of the euro area said that it did not want the European Union to be the way it is. High representatives of your home country then chimed in along the same lines, Commissioner.
The euro was never an end in itself. The euro was always just a marker along the way to further development of the European Union. Now - although the Council is not here, unfortunately - everyone is asking the same question: where to with Europe now? What are the next specific steps? Some are talking about the core of Europe, others of alternatives, still others are saying we should stop expanding, but some are behaving as if nothing will change. Therefore, we will try again with the euro, and even try again after that.
However, when we make these decisions, we should bear in mind the political realities in the European Union, so when we vote today, I will have very mixed feelings about whether simply ignoring the vote - the reality in Europe - is really the right thing to do.
Dariusz Rosati
on behalf of the PSE Group. - (PL) Mr President, I would like to begin by thanking Mr Casa for producing an excellent report. I wish to say that the PSE Group will be supporting this report.
I would also like to emphasise that we are dealing for the first time with the entry of a Central European country, a post-Communist country from the old Soviet bloc, into the euro area. I see this as not only a symbolic event, but also an important step along the road towards European integration. This is a success for the monetary union, as it is being entered by a dynamic and competitive economy unburdened by public debt, and this will surely serve to strengthen the euro area. Secondly, it is also a success for Slovakia, which successfully met all the membership criteria and will be able to benefit from the advantages of a common currency. This success is particularly important and necessary today, when the results of the failed referendum in Ireland have shaken faith in the future of European integration. Slovakia's accession to the euro area shows that the process of deepening European integration is moving ahead, and I believe that even the greatest Euro-sceptics will not be in a position to hold it back.
Slovakia's acceptance into the club of States making use of the common currency is confirmation that, when introduced, consistently economic and structural reforms pay off and bring positive results. Today Slovakia is one of the most rapidly developing States in the European Union. Commissioner Špidla spoke about this. One source of these successes is in fact reforms, and here thanks and recognition are due, both to Mikuláš Dzurinda's government, which brought in these difficult reforms, and to Robert Fico's current government, which is continuing them.
Slovakia's adoption of the euro is also a major challenge. In particular, the Slovakian Government must make sure that the change in currency takes place in an organised manner, so that there are no price rises, and so that the Slovak public's support for the new currency is maintained in future.
In congratulating my Slovak fellow Members on this success, I would also like - as a Polish MEP - to express the hope that my country will soon be joining them.
Wolf Klinz
Mr President, Slovakia has indeed achieved amazing things within a few short years. Who could have imagined that Slovakia would be one of the first of the new Member States to be able to join the euro area? However, the hard work is not over; in fact, it has only just begun. In their assessment and analysis, the Commission and the European Central Bank made it clear that the question of whether inflation can be kept at the desired level over the long term remains open. Indeed, Slovakia is aware of this problem. Otherwise this unparalleled step of revaluing the country's currency, the koruna, by more than 17% to match the euro makes no sense. I can only appeal to Slovakia not to give us cause to experience a second Slovenia where, almost as soon as the country joined the euro area, inflation became rampant.
The step you have taken of revaluing the koruna shows that you are taking dealing with inflation seriously. It is true that imported inflation, especially in the case of energy products, can be kept somewhat in check by this means. However, that does not mean that measures in other areas cease to be very important; they always will be. As Commissioner Špidla mentioned, restrictive fiscal policies, wage increases that continue to focus on increasing productivity and not on the wishes of employees, and mobilisation of the employment market are all part of it. We know that circumstances vary greatly between Slovakia's diverse regions. There is above average unemployment in some regions while in others, there are too few skilled workers.
Mr Radwan is absolutely right. Joining the euro area is not just an economic step, but also a political one. Back then, it was designed as entry to a phase that would be completed by a much more extensive integration. I hope that Slovakia, through moderate, correct, structure-oriented policies, will make its contribution to being able to chalk this entry up as a success at the end of the day.
Zbigniew Krzysztof Kuźmiuk
Mr President, in taking the floor in this debate on behalf of the UEN Group, I wish to draw attention to the following issues. Once again the European Commission is reminding us of the need to meet all of the Maastricht criteria prior to entry into the euro area, with reference to the new Member States. Meanwhile, it is choosing to remain silent regarding the fact that, at the time the euro was introduced, many of the old Member States did not meet these criteria.
Secondly, despite changes in the Stability and Growth Pact that benefit such countries as Germany and France, the characteristic lenient position taken by the Commission with regard to the largest States in the euro area concerning observance of the Maastricht criteria has not changed. The Commission has in the past tolerated both significant budget deficits and, especially, a level of public debt exceeding 60% of GDP, and it appears to be tolerating these still. In 2006 public debt in the Fifteen was, on average, 63% of GDP, and as many as half of the countries in the euro area had a public debt that exceeded 60%. In this situation, Slovakia's achievements in the form of a deficit of 2.2%, or a public debt of just 29%, with inflation at 2.2%, are particularly worthy of mention.
Slovakia's entry into the euro area will be an important experience for the new Member States. They all have a relatively low level of GDP per head, a large income differential over the populace, a low level of affluence or a relatively low overall level of prices. The consequences of introducing the euro in Slovakia, especially...
(The President cut off the speaker)
Hanne Dahl
on behalf of the IND/DEM Group. - (DA) Mr President, Slovakia wishes to participate in the euro, and I do not blame it for that, yet I wish to take this opportunity to call for level-headedness. After all, it could be said that the euro is about to take its first test. For various reasons, we are seeing price increases, not only in Europe but worldwide. Inflation is rising, and inflationary expectations have been generated. The euro as a currency has not faced this test before. The European Central Bank operates on the basis of a maximum inflation rate of 2%. It has no means of enforcing this ceiling other than to raise interest rates in order to reduce the level of activity in an attempt to bring down inflation. If it does this, there is reason to fear recession. The Stability and Growth Pact focuses exclusively on ensuring that public deficit does not exceed 3% of GDP. This restraining of economic stimulation gives us grounds to fear further recession in Europe. If I were Slovakia, I would at all events defer abolishing my own currency in favour of the euro until the latter has passed its first test in economic crises.
Sergej Kozlík
(SK) Mr President, ladies and gentlemen, Commissioner, we can learn a lot from history. In the 1990s most of the then eurozone members were not capable of meeting the convergence criteria. Most of these countries had problems with excessive deficits, public finances and inflation.
During the reference year, 1997, Germany had problems complying with the criterion relating to the level of public borrowing, and as a result even those countries that had significantly exceeded the criteria values, such as Belgium or Italy, were tolerated. Some countries in the nascent eurozone had even resorted to so-called 'creative accounting', i.e. procedures that made their economic results look better than they were. Afterwards, although there were some hiccups, most of the eurozone members solved and continue solving these problems under the umbrella of the euro, a strong single currency. I must point out that these countries have not met all the deficit criteria. Therefore, those who point the finger at the applicants for accession to the eurozone should take care not to cast the first stone.
The Slovak Republic not only met the convergence criteria; it met them well in advance. The development of the Slovakian parameters had been monitored for a long time and was fully transparent. Fears of future inflation, expressed by the European Central Bank, can be generally applied to all eurozone members because the European economy is not developing in a vacuum. The current global price explosion is proof of this.
Consequently, I welcome the positive position of the European Commission and of the European Parliament as highlighted in the report by the rapporteur, Mr Casa, on the adoption by Slovakia of the single currency on 1 January 2009. This position is not only a technical but also a significant political gesture that signals to other applicants for accession to the eurozone that their efforts can lead to a tangible result.
Ján Hudacký
(SK) I would like to begin by expressing my thanks to the rapporteur, Mr David Casa, for his excellent and balanced report, and for his pragmatic approach when evaluating the individual amendments.
Slovakia's accession to the eurozone has not come about by chance. It is the natural culmination of enormous efforts by the Slovak Governments that created, in particular between 1998 and 2006, a solid economic base through radical economic reforms in the areas of finance, tax and social affairs.
These reforms, together with direct foreign investment, have enabled Slovakia to enjoy constant and high economic growth. Continuous efforts to reach the goal, as well as the responsible conduct of the Slovak Governments and the National Bank, made it possible to meet all the Maastricht criteria necessary for accession to the eurozone, without extra influences such as hidden inflation or the artificial strengthening of the Slovak currency, the koruna.
Some members of the ECON Committee have voiced their concerns about the long-term sustainability of these criteria, in particular a low inflation rate. I am convinced, however, that Slovakia has all it needs to meet these criteria on a long-term basis, provided that at least a standard fiscal policy is in place and further structural reforms are carried out. The developments in the area of energy and food prices are, and will continue to be, a global problem. Slovakia will definitely not be a country that goes beyond the agreed framework.
To conclude, I would especially like to congratulate the people of Slovakia, who accepted these fundamental and radical reforms and therefore deserve the utmost praise for achieving this positive result.
Pervenche Berès
(FR) Mr President, Commissioner, I believe that thanks to our rapporteur, Mr Casa, we have a balanced report for welcoming the political decision we are going to take: Slovakia's entry into the euro area. This is the first of the 'Visegrad' countries to join the area and I believe that, from a political point of view, it has major significance that needs to be underlined.
For the Slovaks, it is the end of one adventure and the start of another. It is the end of preparation and of reaching a position that fulfils the Maastricht criteria. Experience has shown us that once a country joins the euro, the hardest is often yet to come. In Slovakia's case, we can see that from the point of view of controlling inflation and pursuing balance, and from the point of view of social cohesion and implementing structural reforms, there is still much to be done. To achieve this, I believe the mechanisms we are discussing so that, in future, the Economic and Monetary Union is better able to support and work together on the way Member States use their currency, will be helpful.
We will not be changing the much-discussed Maastricht criteria. Nobody has asked for them to be changed, and yet they have to be interpreted, to be examined in a changed context. Economic and Monetary Union is now 10 years old, and we know what is still wrong with it in terms of the balance between economic policy, monetary policy and even its external representativeness. It is this Economic and Monetary Union that Slovakia is joining; it is not the same situation as 10 years ago and we all need to take this into account.
Olle Schmidt
(SV) Who would have thought, when Vladimir Mečiar led Slovakia, that his country would not just become a Member State of the EU but would also introduce the euro some 10 years on. It is truly a Slovakian miracle. The rapporteur points out the advantages which the euro brings but also the risks and problems which may arise. It is good that Slovakia has taken on board the ECB's view of the risk of increased inflation with the adoption of the euro and I think it was necessary therefore, after consultation, to revalue the koruna. It shows both instinct and confidence for good future economic policy as a member of the euro group.
Mr President, I hope that in the near future my own country will also realise the importance, both economically and politically, of participating fully in EU cooperation. Although referendums are not very popular these days, I hope that over the period 2010-2011 we shall be able to hold a referendum which will vote to introduce the euro in Sweden.
The financial crisis shows what a strong European currency and an effective central bank mean to the protection of the EU's growth and economy. With the continued application of strict criteria for entry and with constructive assistance available to all those who become members of the euro group, the EU's economy will become even stronger.
Zsolt László Becsey
(HU) Thank you for the opportunity to speak. A great moment has arrived, since Parliament, and later on the Council in the formal legal sense, are about to decide whether the first of the former Council for Mutual Economic Assistance (CMEA) and Warsaw Pact countries will be admitted to the single currency area. I congratulate Mr Casa, the rapporteur, for doing a splendid, outstanding job.
I am delighted that Slovakia has fulfilled all the criteria set out in quantitative terms in the EC Treaty as conditions for admission to the euro zone. This achievement is the result of ten years' work. I believe it is important only to voice an opinion on whether the applicant country has fulfilled the criteria, because otherwise we discriminate among Member States on the basis of whether they joined the euro zone earlier or will do so in future. Loosely defined sustainability criteria - notably with regard to inflation or debt - or real convergence cannot be the subject of separate quantitative analysis in the report, since all Member States in the euro zone, must be trusted equally from the moment they join to implement sustainability. This is especially the case if the Member State in question has a low and falling level of debt compared to its fellow euro club members. This is a vital question for the future enlargement process.
The Slovak Government is taking on a huge responsibility. As soon as its exchange rate is frozen, in other words from July onwards, it must demonstrate that it is not only concerned with its own membership of the euro zone but also carries responsibility for the other countries in the region. In view of this, Slovakia must use all means at its disposal to keep inflation under control, in other words within the reference limit. In doing so it will demonstrate that the understandable and justifiable fears expressed by several Members of this House and the European Central Bank (ECB) - namely that after the massive shift in the central exchange rate occurs, Bratislava may unable or unwilling to keep the brakes on the inflationary pressure resulting from import prices and from closing the price gap - are not compounded by an irresponsible attitude.
Furthermore, this is not the time or the place to address other unresolved issues relating to enlargement of the euro zone. Issues such as ensuring that applicant countries submit their request in time, defining what we mean by discipline concerning the timeframe between the Commission forming an opinion and a decision being reached, or defining the notion of real convergence, or how long we can realistically expect exchange rate stability to be maintained in the event of appreciation, must be addressed separately. These issues should not be addressed here, in a selective and discriminatory way, and this is why I am abstaining today from voting on these issues. Thank you, Mr President, for the opportunity to speak.
Monika Beňová
(SK) In recent years the Slovak Republic underwent many difficult reforms and the present government has successfully compensated the poorer sections of society affected by them. Since the government approached, responsibly and conscientiously, not only the compensation with regard to the reforms but also the task of meeting the obligatory criteria and ensuring a smooth overall process culminating in the adoption of the euro on 1 January 2009, Slovakia today has one of the most successful economies (not only within the Union) and we have also succeeded in increasing the employment rate. All of these facts suggest that the new criterion of permanently sustainable inflation will not be an insurmountable problem for Slovakia in the future either.
It is the sincere wish of the Government of the Slovak Republic that the adoption of the euro on 1 January 2009 should not have a serious impact on the poorer sections of society. Consequently, the government is already taking steps to protect these people and to create for them a comfortable framework for the period of preparation for the new currency and later its use.
For example, the Slovak Government will soon debate a moratorium on the prices of some basic foodstuffs. Another similar step is the attempt by the Slovak Government to reach an society-wide consensus on the issue of the transition to the euro. The government has involved the regional and local governments, professional circles and civil society, as well as churches, in this programme.
Ladies and gentlemen, allow me to finish by saying that cooperation and mutual respect, rather than unsubstantiated and often populist criticism, are the only successful way forward for the Union, in all respects.
Ivo Strejček
Mr President, it is rather a peculiar day for us. We used to live in the same country, Czechoslovakia, and now, today, we Czechs can wish all the best to the Slovaks in joining the euro.
Slovakia was given the green light to join the euro zone a few weeks ago. The Slovakian Government as well as the Slovak Central Bank are well aware that meeting crucial criteria, not in the short term but in the medium and long terms, will be a demanding task.
The Slovak economy is in the process of catching up with the rest of the European Monetary Union. That may lead to pressure on prices and inflation and I am sure that the Slovaks will cope with it. But that is not what I want to talk about now.
Today I would like to put the emphasis on something different, on something which I would personally call the Slovak story, the way to the euro. The reality that Slovakia will join the euro zone is based on sound foundations and the remarkable results of the Slovak economy. It is fair to stress the positive role of the former Centre-Right coalition Slovak Government, led by its skilful Prime Minister Mikuláš Dzurinda. Having carried out all important structural reforms, the Slovak economy has met all important criteria: reduction of public debt and keeping inflation under control; the author of these reforms was the government and cabinet of Mr Dzurinda. I wish all the best to the Slovaks in the euro zone.
Vladimír Maňka
(SK) In the course of the last six years, the Slovak economy has been growing at an average rate of more than 6.5% per year. Last year growth even exceeded 10%. According to all the indicators, Slovakia meets the criteria with room to spare.
The Slovak authorities are aware of the situation with regard to the real and nominal convergence of the Slovak economy and its potential impact on future economic and inflationary development. In their opinion, Slovakia's consolidation is in line with the Stability and Growth Pact. In accordance with the approved three-year budget, the primary fiscal goal is to reach the deficit of 0.8% by 2010, so this means meeting the fiscal goal. In accordance with the agreed data, the goal is to reach a balanced budget by 2011. That means budget a surplus of 1.3% leaving aside the second pillar.
The Slovak Government has adopted measures to keep inflation under control. In June it approved a modernisation programme, featuring structural reforms of the labour market, consolidation of public finances and support for education, science and research. Let me emphasise that the representatives of the business community, entrepreneurs, employers, trade unions, pensioners, Slovak towns and villages, and banks all support the adoption of the euro in Slovakia. The government's social partners signed a declaration in which they undertake to keep wage increases in line with productivity growth. This will significantly contribute to the sustainability of inflation in Slovakia.
I would like to thank the rapporteur and the shadow rapporteurs for their correct approach, based on numbers, facts and analyses. The Slovak officials and the Slovak people wish to contribute to the development of the European economy, and thus to the stability and reliability of the euro.
Zita Pleštinská
(SK) Since the euro is an important symbol of removing barriers and bringing Europeans together, the adoption of the euro by Slovakia is yet another historical step in the process of European integration.
The preparations for the adoption of the euro by Slovakia had begun even before the Slovak Republic joined the European Union. The previous Slovak Government, led by Mikuláš Dzurinda, approved the strategy for the adoption of the euro as far back as 2003. It implemented important reforms that made Slovakia a successful country, economically and politically.
As inflation has increased in Slovenia since the country adopted the euro, the issue of the sustainability of inflation and the public deficit causes anxiety in Slovakia. However, I do not agree with the views of some of my colleagues that additional criteria for monitoring the economic stability of Slovakia are needed.
Slovakia meets all of the Maastricht criteria, which are the conditions for the adoption of the euro. It is too late for a debate on setting the Maastricht criteria for fast-growing economies. Instead I would like to mention the reason for the change in the central parity, which the German Members presented as a negative phenomenon. The central parity shift reflected, on two occasions, the economic development of the country, which was backed up mostly by productivity growth.
I call on the Government of the Slovak Republic to step up the campaign targeted at the citizens, in particular the provision of information to vulnerable groups. I think that dual price display should be obligatory not only for six months before entering the eurozone but also for at least one year after adopting the euro. This will help consumers to get used to euro prices.
I am convinced that a good competitive business environment will result in more choices for consumers, which is the best remedy for rising prices. I believe that Slovakia will also learn from the experience of those countries that have already adopted the euro.
To conclude, I would like to congratulate my colleague, Mr David Casa, for his support for Slovakia's accession to the eurozone. I believe that his name will go down in the history of the Slovak Republic.
Elisa Ferreira
(PT) Mr President, Commissioner, ladies and gentlemen, 10 years after its birth, the euro is an undeniable success and is today one of the pillars of trust for citizens in the European project. I therefore welcome the enlargement of the euro area. Following on from identical decisions regarding other states, it will now extend to Slovakia.
However, in mentioning the 10th anniversary of the euro, we must include the lessons learned along the way, lessons on the sustainability of the process and on the impacts on real convergence that are linked to the single currency. Perhaps there is some scope for improving application of the accession criteria and perhaps thought should be given to the sustainability and robustness of the process for old and new members. In the case of Slovakia, the 17% revaluation of its currency, albeit planned and in line with the Treaty criteria, gives food for thought.
As I said, these questions deserve a serious debate in which the European Parliament must have an active voice, and the Socialist Group's wish is for the euro to contribute to more than just financial stability. It must also be an instrument serving to boost the Union's real convergence, employment and progress. We shall suggest continuing this discussion in more depth during the EMU@10 debate, that is to say the celebration of ten years of the euro.
For the time being, I should just like to congratulate the rapporteur and shadow rapporteurs and recognise and praise the extraordinary efforts undertaken by Slovakia, its Government, and the social partners, and the success they have already achieved. I hope they will be successful in their forthcoming participation in the single currency project and my very best wishes to them in exactly this regard.
Hans-Peter Martin
(DE) Mr President, it is a good thing that Slovakia has the opportunity to join the euro area. You only have to imagine what it would have been like in Europe over the last year without the euro. The currencies of the individual states would have been a target, just as in the days of Soros. However, as Italy has shown, sometimes being bound so securely to the euro is not quite such a good thing. If it were possible to advise Slovakia - which, of course, would have to make its own decision - then I would be giving some thought to an opt-out clause, especially because of what is now happening at European level. We are running the risk that the EU Summit will not read the signs of the times, that it will carry on as if it is 'business as usual'. The distance between the citizens and the European elite is growing in such a way that the entire European project is put at risk, whereas instead everyone should be working towards true democracy.
Milan Gaľa
(SK) I would like to thank the rapporteur, Mr David Casa, for his work on the report. In the last decade, in particular during the years of Mr Mikuláš Dzurinda's Government, post-communist Slovakia implemented demanding socio-economic reforms that made it possible for the economy to meet the Maastricht criteria.
Slovakia's adoption of the euro will bring about changes. It is necessary to prepare the citizens for the changes and to persuade them that accession to the eurozone will be beneficial to them. It is necessary to create a sense of trust in the new currency and provide sufficient information. Several Slovak businesses have voluntarily pledged to observe the so-called Business Code of Ethics for the euro changeover. They have agreed to offer their customers, partners and citizens enough information and pledged not to misuse the currency conversion in any way for the purpose of personal financial gain.
I think that these steps will help us to trust in the common European project. I also believe that the European Parliament will vote for Slovakia's adoption of the European currency today.
Miloš Koterec
(SK) The new currency is a turning point for the society and its citizens. Like any change, there are some concerns about its outcome. Knowing the situation in Slovakia, I am sure everything will turn out just fine and all worries will disappear a few months into 2009.
My confidence is based on two main elements. Firstly, it is generally known that Slovakia has fully met the Maastricht macro-economic criteria, which is proof of Slovakia's formal readiness to adopt the euro. Slovakia will also ensure sustainability of the criteria. What is more, the government, the parliament, the social partners and the entire society are making serious plans for solutions to practical problems that might accompany the currency changeover.
Dual pricing will be introduced everywhere, and the regular monitoring mechanism is ready so that the changeover to the euro cannot be misused. A number of other measures are also in place to give the citizens information and help with day-to-day difficulties in using the euro. I believe that from next year onwards Slovakia will be a model stable eurozone member; a problem-free showcase for the European Union.
DanutBudreikait
(LT) I would like to congratulate the Commission on giving Slovakia the green light to join the euro area from 1 January next year. Slovakia's adoption of the euro is a great example to other states and an incentive to them to increase their efforts and adopt additional measures for achieving the convergence criteria.
Slovakia is to join the euro area at a time when the EU and the world as a whole are experiencing a very complicated economic situation, with rising fuel prices and growing inflation. Therefore, every country that is seeking membership of the euro area or is already an established member should learn from Slovakia's example.
I would also like to point out the fact that, with Slovakia about to become the 16th member of the euro area, it is essential to ensure that an efficient decision-making procedure is put in place for the European Central Bank's Governing Council. Alas, the final decision on the rotation system has not yet been made. I would like to point out the importance of not postponing the introduction of the rotation system until the number of members of the Management Board reaches 18 and making sure that it is implemented as soon as possible in view of both the preparations that Slovakia must carry out in order to join the euro area and the further expansion of the latter.
Simon Busuttil
(MT) I would like to congratulate my colleague Mr Casa, who I know put a lot of work into preparing this report, and I wish him success. I would also like to congratulate Slovakia, which is about to adopt the euro. I come from a country that introduced the euro this year and I can assure everyone that, despite the difficulties and sacrifices that a country has to make in order to enter the euro area, it is surely a source of satisfaction and pride for such countries.
I would like to say that it is becoming clear in this discussion that it is possible to have a 'two-speed' Europe. I say this because last week there was a referendum in Ireland. Everyone knows the result. I think it is important to show that Europe can proceed at a different speed and it is also important that we start to consider this possibility for the future development of European integration.
Margarita Starkevičiūt
(LT) Lithuania is a country that made a commitment in its Accession Agreement to adopt the euro. Every single time - that is, four times during our term - that we make a decision on whether to give the green light to one country or another to adopt the euro, we keep trying to upgrade the Maastricht criteria or explain them in a different way.
This tends to confirm the fact that we still have doubts regarding the implementation of these criteria. At the very beginning we, as representatives of Lithuania and representatives of other countries, suggested that these issues be dealt with on behalf and at the level of Parliament and the Council. However, all this time these suggestions have been turned down. Instead of sitting down to clarify the nuances and technicalities hindering the successful expansion of the euro area, we would rather play about by making separate, more or less of random decisions for each country.
I would like to point out that it is very clear that we must implement strict fiscal policy and that there is no way we might change our...
(The President cut off the speaker)
Zuzana Roithová
(CS) Mr President, the reason for the delays with the European unification project, accompanying the ratification of the new Treaty, is probably the fact that the prosperity brought to Europeans by the common internal market is already being taken for granted. It is a pity that our praise for the success of the Customs Union that is now celebrating its 40th anniversary is too quiet. The 10 years of successes and achievements of the common currency are also a reason to celebrate. By forcing governments to maintain budgetary discipline, the eurozone has created an admirably stable macro-economy, immune to all shocks in spite of globalisation. As a Czech Member of this Parliament, I want to congratulate Slovakia on its accession to the eurozone. The lion's share of this success belongs to Mr Dzurinda and the reforms he implemented five years ago. The left can now celebrate their success because when it entered into government it adopted membership of the eurozone as a national interest. Hopefully it will teach the Czech Eurosceptics a lesson and one day it will be the Slovaks who will be congratulating us. Sadly, this will take at least another five more years and possibly even longer.
Werner Langen
(DE) Mr President, Slovakia has experienced an economic upturn and, after this very controversial debate about its fulfilment of the criteria, we will vote on whether it should join the euro area.
I would like to thank the rapporteur, Mr Casa, because in his report, he took into account the objections that were raised. The reform process and reflections on it do not come to an end when a country joins the euro area; rather, that is when the real challenge begins. Inflation is and will continue to be a problem in Slovakia. Not for nothing have there already been two revaluations - most recently of 17.65% - and I say in advance that before the exchange rate is finally set, there will be a further revaluation of the Slovak koruna. Therefore, we must all play our part to ensure that real convergence occurs. I hope that the Council and the Ministers of Finance take Parliament's concerns seriously and that the Commission will conduct an open discussion on the process in future.
Vladimír Špidla
Member of the Commission. - (CS) Ladies and gentlemen, Slovakia now has the opportunity to join the eurozone. This is possible because of the Slovak Republic's socio-economic results. Credit for this achievement is also due to all of Slovakia's successive governments and their firm focus on this issue. I think that the Slovak leadership has in general shown their will and ability to respond to the necessary changes. This opportunity is also due to the consistency of the European Union's policies and to the launch of the European project because Slovakia has accepted and met all the necessary criteria. This fact has opened the door for the adoption of the euro and no further doubts were expressed. In my opinion, this is a very important aspect. Enlarging the eurozone to include another country, Slovakia, will definitely lead to deeper European integration. It will not be just the Slovak Republic but also the European Union as a whole that will benefit from this deeper integration when this very successful and fast-developing economy joins.
Fears of inflation were mentioned in the debate. Of course, in some ways these fears are justified. On the other hand, there are equally potent arguments proving that the Slovak Government is consistent in its response and, at any rate, it is not in the interest of any government to set off inflation. Of course the risk of inflation exists, and this matter has been brought to the Slovak Government's attention in all documents and debates. Regarding the issue of revaluation of the Slovak currency, I must say that it always took place within the expected limits, within the framework of flexibility that each government, each country is allowed in this process in order be able to respond, in the best possible manner, to the extraordinary moment when the euro is adopted. This is not an everyday situation, an everyday affair. It is a truly extraordinary situation and the Member States must be allowed some room for manoeuvre. Although the final setting of the value will be a very serious goal and task, and although it will be an extraordinary operation, it will not be taking place for the first time. The eurozone has been enlarged before and this complicated expert operation has been carried out many times with adequate success.
Ladies and gentlemen, allow me to congratulate Slovakia on taking this big step and achieving this huge success. I also want to emphasise that this is clearly the result of the work of successive Slovak Governments and the understanding and will of the Slovak people.
David Casa
I would like to thank all my fellow Members for the discussion. I agree that in this Parliament there is consensus about (the fact) that we all agree that Slovakia is ready to enter the euro area. In fact, there are some amendments that have secured the agreement of several political groups.
We have before us as speakers - before me, to be exact - a historic moment. We also have, as several Members have said, a club that not only accepts the largest and most developed countries, but also welcomes anyone who is prepared and ready to accept the rules of the European Union. Therefore, today we have an area that accepts anyone who meets all the criteria laid down in the Treaty. There is no doubt, as my fellow Members have rightly pointed out, that it was not easy for Slovakia, and it will not be easy for the country in the coming months.
I will end my speech by once again thanking all those who have helped me to arrive at this point and I sincerely hope that the Slovak people will be able to build on the success they have achieved up to now. I hope that, in the coming months and years, the same success that their country is making in a number of sectors will also be achieved by these people who have worked so hard to reach this very important level.
President
The debate is closed.
We shall now proceed to the vote.