Brussels, 24/05/2012 (Agence Europe) - At their informal dinner meeting in Brussels on Wednesday 23 May 2012, the EU's political leaders had the time to express their sometimes conflicting views on how economic recovery can be encouraged in Europe, but did not decide on anything genuinely new, apart from agreement that the European Investment Bank's capital needs to be increased. The EU27 heads of state will make more tangible decisions about the European Growth Agenda at the full summit on 28 and 29 June.
The president of the European Council, Herman Van Rompuy, commented after the dinner that he had convened the meeting 'for colleagues to discuss how to boost growth in Europe. Tonight's meeting was about putting pressure, focussing minds and clearing the air.' 'It is obvious that opposing 'deficit reduction' and 'growth' is a false debate. They are two sides of the same coin,' said Van Rompuy, going on to talk about three growth stimulus approaches:
1) 'The first point: we need to mobilize EU policies to fully support growth. We therefore invited the European Parliament and the Council to make rapid progress on important legislative proposals, such as the Single Market Act and the Energy Efficiency Directive. We should finalise the remaining issue of the European patent before the end of the Danish Presidency (at the end of June 2012, Ed.). Colleagues also asked for the full and consistent implementation of existing legislation, notably regarding the services directive and argued in favour of a strong impetus for the Digital Agenda.'
2) 'Second, we need to step up our efforts to finance the economy through investments and better access of Small and Medium-sized Enterprises to credit. Reforms must go hand-in-hand with investment and EU funds can play an important role in this regard. To this extent, the board of the European Investment Bank is invited to consider an increase of its capital by June for financing projects across the EU. We welcome also the political agreement of the Council and the European Parliament on the EU-EIB Project Bond initiative, in order to launch the pilot phase this summer as a first step. The Commission will report in June on the reprogramming of the current Structural Funds to support growth, jobs and training. Colleagues mentioned equally the need to continue work and discussions in the Council on the Financial Transaction Tax as well as examine the issue of late payments. We will discuss in June how to fully gear the next Multiannual Financial Framework to growth and job-enhancing policies.' Van Rompuy said that there had been disagreements over the question of a financial transaction tax.
3) 'Thirdly, we need to strengthen job creation. Therefore the EU and its Member States will invest in skills and training. In order to promote a job-rich recovery, it is necessary to make concrete reforms and take measures to support labour demand and job-creation in key sectors of the economy. National Job Plans should be given high prominence in the follow-up of Country-Specific Recommendations on the economic policies and fully used to better stimulate synergies between national and European instruments, including the Structural Funds, in particular to combat youth unemployment. This could be done on the basis of the youth guarantees and quality traineeships. Colleagues said that mobile workers should be better supported, their portability of pension and other rights be enhanced.'
The new French president, François Hollande, said growth should not be seen as contradicting taking a serious line on the budget. He said that the Single Market could encourage trade among Member States but there are not enough incentives for investment to get European countries back to higher levels of growth. Hollande said that some of the ideas on the table were already consensual, such as project bonds, recapitalising the EIB and making use of unallocated Structural Funds, but he said that he had suggested going further and focussing the project bonds on new technology, energy transition and industrial projects (with the aid of the EIB). Hollande hoped the eurobond idea would be taken up, adding that it would amount to extending the European integration project. On the question of a financial transaction tax, the French President said that it would not generate growth in and of itself, because it is a tax, but the income raised by it could be paid into a fund that could be used to foster investment.
The German chancellor, Angela Merkel, said that the politicians had made use of the meeting to prepare for the June Summit and set a European Growth Agenda. Like Van Rompuy, she said that budget consolidation and growth go hand-in-hand, and mentioned discussions over the dinner table about how to create a Single Labour Market, increase EIB capital and make better use of the Structural Funds. Project bonds, she said, must focus above all on Spain, Greece, Portugal and Italy.
The British prime minister, David Cameron, said there had been full agreement on controlling deficits and returning to growth. He commented that it was not possible to have one without the other and there had been good agreement that a more competitive Europe was needed, adding to the Single Market and introducing structural reforms. He said that the financial transactions tax was a bad idea that would cost people jobs and pensions and would make Europe less competitive.
The Italian prime minister, Mario Monti, focussed on the problem of late payments for small businesses, pointing out that the European Summit wanted to tackle the problem head-on. (LC along with EH/AN/FG/MD/transl.fl)