Brussels, 27/09/2011 (Agence Europe) - Taking a highly proactive line, the chair of the Eurogroup addressed MEPs in Strasbourg on Tuesday 27 September to discuss the eurozone sovereign debt crisis. Jean-Claude Juncker shrugged off calls for Greece to leave the eurozone, explaining that Europe had to do more to solve the sovereign debt crisis by resolving budget issues and consolidating economic growth. He called for new life to be breathed into the Community method and for it to be the focus of current reflection on how to boost economic governance, even though the Community method is less effective when a crisis breaks out.
Greece. Responding to Jan Zahradil (ECR, Czech Republic) who asked whether Greece would have to leave the eurozone, Juncker made it crystal clear that he opposes the idea that one or two countries should leave the eurozone because this would not only make things worse for the countries themselves, but also for the eurozone and the wider world. Commenting on the situation in Greece, he said that the sixth instalment of aid (€8bn) under the first bailout would be paid out as long as the fact-finding report drawn up by the European Commission, ECB and IMF experts indicated that the country had taken the right decisions and would be respecting the economic and budget commitments set out in the austerity programme.
Juncker said that at its meeting on Monday 3 October, the Eurogroup would not be taking any decisions because the fact-finders are due to start work in Athens again on Tuesday or Wednesday, so the meeting on Monday will be too soon for the fact-finding report, and the eurozone finance ministers will also need time to study it. Juncker said that the ministers would be fine-tuning the operational details for the decisions taken on 21 July by the special eurozone summit. On the collateral demanded of Greece by Finland for its share of the aid package, Juncker said there was no time to lose and it was crucial that by the middle of next month, all the necessary instruments are in place. Of the 17 eurozone countries, eight have already ratified the 21 July decisions about the second Greek bailout and expanding the powers of the EFSF bailout fund (see EUROPE 10460). The Bundestag in Germany will be deciding on the matter on Thursday 29 September.
What should one say to Northern Europeans, like the Germans, who have the feeling that they are being asked to pay for the errors committed by Southern Europeans? Juncker called for the truth to be told, commenting that Germans are not selfish, but it needed to be explained to them why it is in their own interests to keep the eurozone intact.
Economic governance. Speaking on behalf of the EPP Group, Joseph Daul of France said that Europe had done too little, too late. Juncker admitted that Europe had responded to the crisis at a snail's pace and there was a huge time lag between the time it takes for all 17 nations to go through the democratic process of endorsing decisions and expectations on the financial markets. He said more had to be done in the sense of introducing a policy that reconciles a clean-up of state finances with economic growth. The changes to the Stability and Growth Pact to be voted through on Wednesday will be a step in the right direction.
Calling for politicians in power to return to the enthusiasm and high ideals of the founding fathers of Europe, Juncker called for a root-and-branch overhaul of how the single currency is managed, a reform based on the Community method, even though the method does not work well in times of crisis. He explained his broad concept of economic governance as covering economic, tax and social issues alike.
Guy Verhofstadt (ALDE, Belgium) warned against the temptation of Europe cobbling together some kind of institutional set-up that wouldn't solve the crisis. Daniel Cohn-Bendit (Greens/EFA, Germany) said that the EU economic and monetary affairs commissioner had to be given the same powers to govern the eurozone as the competition commissioner has over antitrust issues.
Unlike the Liberal and Greens/EFA leaders, Juncker said he had never believed in a “United States of Europe” and said the European Commission should not be at the helm of the single currency because this is not covered by the Treaties. He said that the Commission proposes ideas and this monopoly over the issuing of ideas had to be respected, but one should not imagine that governments, which are held responsible by parliamentarians in their country, will simply vanish into thin air. Juncker therefore had no objections to the president of the European Council, Herman Van Rompuy, chairing the eurozone, as has been mooted by France and Germany. He said that the person chairing all 27 member states can perfectly well chair the 17 eurozone nations which are, after all, part of the EU27. It is for the Commission to propose and for heads of state to dispose by giving instructions to eurozone finance ministers, who manage the single currency from day to day. He pointed out that not everything could be done by the Commission, but equally nothing could be done without it. Describing himself as the leading proponent of assigning greater powers to the European Commission, Juncker recommended expanding the codecision method of EU decision-making. (MB/transl.fl)