At a non-inclusive Eurozone summit on Friday 23 March, the heads of state or government of the 19 countries of the Eurozone will discuss the possibility of creating a specific fiscal capacity for the Eurozone.
This discussion, which was requested by the French President, Emmanuel Macron, at the end of 2017, will be fed into by the specific proposals presented by the European Commission in December as part of its package of proposals on deepening Economic and Monetary Union (EMU) (see EUROPE 11920).
Although several countries, including France and Germany, look kindly on the proposal, there are differences of opinion over the ins and outs of this fiscal capacity. Some member states would like it to be part of the EU budget, whilst others are calling for it to remain outside. There are also clashes between those in favour of making such an instrument available to promote structural reforms, and those which consider that a specific fiscal capacity should be used to support investments.
Calling for the 28 member states also to have the opportunity to exchange views on economic issues, the President of the European Council, Donald Tusk, has invited Mario Centeno, the President of the Eurogroup, to present the work on the completion of Banking Union in the Eurozone on Thursday evening.
Significant differences may also be observed on the subject, as the countries of the North and of the South disagree over the pace of work to reduce and share banking risks, for instance through the creation of the European Deposit Insurance System (EDIS) (see EUROPE 11979, 11980).
On Thursday, all 28 member states will discuss converting the European Stability Mechanism (ESM) into a European Monetary Fund (EMF) and the creation of a common backstop via the ESM for the Single Resolution Fund.
No major decisions will be made at this European Council and Eurozone summit. Pending a Franco-German roadmap on the deepening of the Eurozone (see EUROPE 11983), all eyes will be on the June European summit.
ECB. Finally, the Twenty-Eight will formally appoint the former Spanish Finance Minister, Luis de Guindos, to the post of vice-president of the ECB (see EUROPE 11970). (Original version in French by Lucas Tripoteau)