The European finance ministers and central bankers of the countries of the European Union have been meeting since Thursday 10 April for an informal three-day meeting organised under the aegis of the Polish Presidency of the Council of the European Union. No decisions are expected from the discussions, which will focus on the impact of US tariff policy on the EU and on the financing of the military effort expected from the Member States.
After the Eurogroup meeting on Friday 11 April (see EUROPE 13618/8), Europe’s major financial powers will be discussing at lunch the repercussions of the trade tensions provoked by the United States on the European economy, and how a coordinated response could be envisaged.
According to a European source, US President Donald Trump’s announcement of a temporary suspension of new US tariffs (except for China) created a “rather positive” atmosphere at the start of the ministerial meeting (see other news). “Now is the time for management to think about a strategy to deal with this new situation. And the 90 days that are opening up offer us a real breath of fresh air to do so”, said the source on Thursday 10 April, urging the EU not to overreact.
On Friday afternoon, a discussion will focus on the competitiveness of European financial markets and their role in supporting investment.
In a preparatory note of which Agence Europe received a copy, the Polish Presidency notes that the “volatility” recently observed could become recurrent in the future and contribute to increased fragmentation of the financial markets. It therefore recommends constant monitoring of the impact of these developments on European capital markets.
One way of strengthening the EU’s resistance to exogenous shocks could be to deepen the EU’s internal market.
“We must reflect on the European internal market, which is our key engine for growth and job creation. According to the IMF, current regulatory barriers within the EU are equivalent to tariffs of over 40% in goods, and 110% in financial services. A natural response should be to bring down these barriers as a matter of urgency”, notes Polish Minister Andrzej Domański in his letter of invitation to his European counterparts.
Financing the rearmament effort. On Saturday morning, discussions will focus on the financing of the defence sector. They will be based in particular on the recommendations of the Bruegel think-tank, which advocates the creation of a ‘European Defence Mechanism’ (EDM), an intergovernmental structure open to countries inside and outside the EU that want to participate (see EUROPE 13616/23).
“The opinions expressed in this document are, of course, those of the authors and are sometimes a little provocative. But that’ s the whole point of these informal meetings: to allow freer discussion, fuelled by stimulating intellectual contributions”, noted this European source.
Also favouring an intergovernmental approach to help Member States increase their military spending, the Polish Presidency wants to stimulate the ministers’ reflection on innovative mechanisms that go beyond the initiatives already on the table, such as the ‘SAFE’ European instrument for granting loans to Member States (see other news) and the use of the flexibility of the Stability and Growth Pact (see EUROPE 13612/25).
To see the letter of invitation from the Polish Presidency of the EU Council: https://aeur.eu/f/gd5 (Original version in French by Bernard Denuit)