Brussels, 03/07/2003 (Agence Europe) - By adopting the report by Johannes Blokland (EDD, Netherlands)on Thursday in Strasbourg, which assessed the 2002 report of the European Central Bank (ECB), the European Parliament is again welcoming this organisation's successful introduction of Euro coins and notes, while regretting the effects of this operation on inflation (notably in the services sector). The EP is requesting the setting up of an investigation into possible negligence and whether similar problems will appear in future members of the Euro Area. Parliamentarians were worried about the recent appearance of forged EUR 200 notes and have suspicions about the link between EUR 500 notes and money laundering. They have asked the Commission and the ECB to set up a work group on the use of the Euro to study the need for a EUR 1 note. The EP considers that Member States should keep their freedom to choose whether to put into circulation a one centime Euro, which consumers and retailers appear to find "really irritating in certain regions.
According to the EP, the ECB reacted correctly to economic and financial developments but should beware of the swiftness in which markets react or go beyond its decisions. The EP is also asking the ECB's independence to not be put into question, as well as that of the European Central Bank System. It has criticised the fact that some Member States had broken with the Stability Pact in 200, "which risked undermining the credibility of the Euro Area and subsequently the effectiveness of monetary policy. It is calling on the Commission to continue to apply the pact intelligently and flexibly.
The EP identifies a series of challenges that the ECB must meet in 2003 and in coming years: to continue to monitor prices in 2003 while keeping to the importance of a strategy that intends to create sustainable growth and job creation in the Euro Area; carry out a feasibility study to asses whether invoices in Euro for goods and energy services benefits the Euro Area; illustrate in its publications, the weak points in implementing structural reforms; carry out more frequent economic forecasts and adapt its statistical instruments to take into account structural changes in the world economy in the last decade.
Furthermore, the EP urges the Governing Council to take its decisions by ballot as this may, in some cases, speed up the ECB's reaction to the evolution of the economic situation. The EP recalls that it has for a long while insisted on publishing the concise minutes of each meeting of the ECB Governing Council, and also proposes that the latter should report on the position of the parties for and against as well as on the breakdown of votes and minority opinions.
In response to speeches by MEPs on the resolve shown by some Member States to reactivate growth and on the greater role that the ECB should play in this field, Wim Duisenberg, who was obviously irritated, said: "governments cannot continue to hide behind the ECB to cover up their failure to set in place the structural reforms that Europe so urgently needs". "We have done what we had to do", he said, inviting the governments to get down to work in their turn. He mainly referred to the declarations by French Primr Minister Jean-Pierre Raffarin, German Chancellor Gerhard Schröder and the Head of the Italian government, Silvio Berlusocni. During his first speech, Mr Duisenberg insisted on the fact that the opinions expressed in the resolution are close to those of the ECB concerning the need for respect of the Stability pact and the precisions on monetary strategy. However, he considers, unlike the MEPs, that the current methods of transparency and the decision-making process are inadequate.
During the debate, Mr Blokland said that, due to the political context, "the ECB must make a considerable effort to guarantee price stability". In his view, it is not the moment to challenge the policy of the Central Bank. Another major argument is that the ECB has not yet known its baptism of fire consisting of guaranteeing price stability despite a difficult economic situation, if not a recession. Commissioner Pedro Solbes recalled that the mandate conferred on the ECB by the Treaties is very clear: to guarantee price stability. He felt that Mr Blokland interprets things rather differently, since the report calls on the ECB to act in other areas which do not come within its sphere of competence (invoicing of goods and energy supplies). According to Mr Solbes, the Bank must remain neutral about the international use of the euro. Speaking on behalf of the EPP-ED Group, Italian national Generoso Andria said the ECB should have a more incisive role in economic policy. On behalf of the Socialist Group, Christa Randzio-Plath, from Germany, recalled that 75% of citizens are in favour of single currency and that the interest rates are currently very low in Europe. She wondered, however, whether the ECB's monetary policy follows the same strategy. In her view, a better definition of price stability is needed. She also calls for withdrawal of the EUR 500 notes and the creation of 1 euro nots, since there is a one dollar bill.