EU Economy, So-Far-So-Good – Barroso

• September 8th, 2010
• Posted by EUEditor

The President of the European Commission , Jose Manuel Barroso, has spoken of cautious optimism over the pace of economic recovery, in his “State of the Union” address to the European Parliament (7.9.10), in Strasbourg.

REGULATION – MEASURES AGAINST A NEW CRASH

He said regulatory measures being put into place and mutual economic assistance across the borders of member states had secured the recovery process.

He noted an agreement among Finance Ministers of the member countries this week, on setting up supervisory agencies for sectors of the economy, notably banking and finance, as “good news”.

“The political deal on the financial supervision package just concluded is very good news.

“The Commission proposals based on the de Larosière report will give us an effective European supervision system.

“I want to thank the Parliament for the constructive role it has played and I hope it will give its final agreement this month.

“We will also go further on regulation. Initiatives on derivatives, further measures on credit rating agencies and a framework for bank resolution and crisis management will soon be before you.

“Our goal is to have a reformed financial sector in place by the end of 2011” Mr Barroso said.

EXCERPTS

“Over the last year, the economic and financial crisis has put our Union before one of its greatest challenge ever; our interdependence was highlighted and our solidarity was tested like never before.

“As I look back at how we have reacted, I believe that we have withstood the test. We have provided many of the answers needed – on financial assistance to Member States facing exceptional circumstances, on economic governance, on financial regulation, on growth and jobs…

“My message to each and every European is that you can trust the European Union to do what it takes to secure your future.

BETTER OUTLOOK, WITHOUT ILLUSIONS

“The economic outlook in the European Union today is better than one year ago, not in the least as a result of our determined action.

“The recovery is gathering pace, albeit unevenly within the Union.

“ Growth this year will be higher than initially forecast.

“The unemployment rate, whilst still much too high, has stopped increasing.

“Clearly, uncertainties and risks remain, not least outside the European Union.

“We should be under no illusions; our work is far from finished; there is no room for complacency.

“Budgetary expansion played its role to counter the decline in economic activity, but it is now time to exit.

“Without structural reforms, we will not create sustainable growth; we must use the next 12 months to accelerate our reform agenda.

“Now is the time to modernise our social market economy so that it can compete globally and respond to the challenge of demography…

MOMENT OF TRUTH

“ This is Europe’s moment of truth; Europe must show it is more than 27 different national solutions …

“Essentially, I see five major challenges for the Union over the next year:

•    dealing with the economic crisis and governance;
•    restoring growth for jobs by accelerating the Europe 2020 reform agenda;
•    building an area of freedom, justice and security;
•    launching negotiations for a modern EU budget, and
•    pulling our weight on the global stage.

“I now see a willingness of governments to accept stronger monitoring, backed up by incentives for compliance and earlier sanctions.

“The Commission will strengthen its role as independent referee and enforcer of the new rules.

“We will match monetary union with true economic union.

“If implemented as we propose, these reforms will also guarantee the long-term stability of the euro.

BANKING AND FINANCE

“For the economy to grow, we also need a strong and sound financial sector; a sector that serves the real economy; a sector that prides itself on proper regulation and proper supervision.

“We took action to increase bank transparency.

“Today we are better than one year ago. With the publication of the stress test results, banks should now be able to lend to each other, so that credit can flow to Europe’s citizens and companies.”

Reference

José Manuel Durão Barroso President of the European “Commission, State of the Union 2010”, Strasbourg, 7.9.10. SPEECH/10/411

See also, EUAustralia Online: “Greece pleases EU on money recovery”, 11.8.10; “‘Stress Test’ …”, 24.7.10; “EU Moves …”, 21.6.10; “Banking and Finance … “, 28.5.10; “EU intervention in crisis brokering”, 17.10.08.

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