Pierre Moscovici, the Commissioner responsible for Economic and Financial Affairs, and Valdis Dombrovskis, his counterpart for the euro and Social Dialogue, defended the idea of converting the European Stability Mechanism (ESM) into a European Monetary Fund (EMF) based on EU law, rather than the inter-governmental method, addressing the MEPs of the economic and financial affairs committee (ECON) of the European Parliament on Tuesday 27 March.
The Commissioners' address was based on the package of proposals presented by the European Commission on 6 December of last year concerning the deepening of Economic and Monetary Union (EMU) (see EUROPE 11920).
The key points of this package include converting the current ESM into an EMF, which would be subject to the control not only of the Council of the Union, but also of the European Parliament. The Commission's objective is to embed the EMF in the legal framework of the EU, as the ESM is currently an inter-governmental organisation steered by the Eurozone countries.
In reply to a question put by Wolf Klinz (ALDE, Germany), Dombrovskis said that the Commission would defend the Community method, calling for a greater role for the current organisation. “I believe strongly in the Community and democratic method”, added Moscovici, despite the reluctance expressed by certain member states at such a move.
Angela Merkel, the German Chancellor, for instance, raised possible problems that may arise for Germany within this context, at the Eurozone summit of 23 March (see EUROPE 11988).
Budgetary stabilisation instrument. Discussions also covered the budgetary stabilisation instrument, which aims to support investment in the event of macro-economic shocks, and which was also suggested in the package of proposals of 6 December.
This instrument, which could take the form of a fiscal capacity for the Eurozone, has not yet been clarified, pending the position to be taken by the leaders and the Commission's proposal on the multiannual financial framework post-2020, to be presented on 2 May.
Pervenche Berès (S&D, France) argued for the most ambitious possible framework adapted to the Eurozone and mooted the idea of bringing in minimum unemployment benefit. Burkhard Balz (EPP, Germany) took a position in favour of boosting competitiveness and carrying out structural reforms.
The Commissioners also stressed the need to iron out differences between the Eurozone countries through a fiscal capacity of this kind. Moscovici also recognised the reservations voiced by certain countries concerning this stabilisation function, as observed at the Eurozone summit of 23 March.
These two questions will be part of the discussions of the Eurozone summit of June, at which decisions must be made on the future of EMU, including the completion of a Banking Union. (Original version in French by Lucas Tripoteau)