Summary of the meeting of the Committee on Economic and Monetary Affairs of the European Parliament, held in Brussels on 20 and 21 January 2009

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enveloppe
  1. Tekst
  2. Originele weergave
  1. Meer informatie

1.

Tekst

I. Chairwoman's announcements

Mrs BÉRÈS announced three extraordinary meetings to be held in Strasbourg on 2 February, 9 March and 23 March 2009.

II. Exchanges of views

  • 1. 
    Exchange of views with Miroslav Kalousek, Minister of Finance of the Czech Republic M. KALOUSEK delivered the speech set out in Annex I.

M GAUZES (PPE, FR) considered that many economic recovery plans had been launched,

but no results were to be seen. He questioned the Minister, in particular, on the distribution of

credit by banks. M KLIMT (ALDE, DE) raised some concerns regarding the different

approaches of Member States to supporting banks. He also asked whether the recovery plan

should not be financially reinforced, considering that the financial figures had worsened. Mrs

FERREIRA (PSE, PT) asked for some information concerning the key issues to be discussed

by the G20 under Czech presidency.

M. PURVIS (PPE, UK) asked the Minister if positive actions were planned to promote the

recovery of the securitisation market. Minister KALOUSEK, responding to this first group of

questions, said that on Tuesday that week ECOFIN had approved a EUR 200 billion recovery

package and that, for the moment, the Council's priority was to implement it and not to

change it. As for the coordination of Member States, he stressed that coordination does not

mean taking the same actions. The Czech Republic, for instance, did not need to recapitalise

its banks. As for the G20, he pointed to the reform of the international financial architecture

as a key point. M KALOUSEK agreed that overregulation could obstruct the market, but said

that the Presidency role is to find a good compromise between different points of view.

Responding to a question on VAT put by Mrs Van den BURG (PSE, NL), M KALOUSEK

said that the issue was the use of VAT as an instrument of the recovery plan, not the tax in

itself. The aim was to reach a common denominator for lowering TVA for work intensive

activities (restaurants, hair dressers, tailors, etc.).

  • 2. 
    Monetary dialogue with Mr. Jean-Claude TRICHET, President of the European Central Bank

M. TRICHET delivered the speech set out in Annex II.

Responding to M GAUZES, who raised the questions of the solidity of the common currency

and bank liquidity, M TRICHET observed that the Euro had proved resilient and resistant, in

a scenario where all currencies are under pressure. As for bank liquidity, M TRICHET spoke

of a general underestimation of the global risk and noted that many of the players were blind.

M MITCHELL (PPE, EI) considered that the ECB is playing a key role in restoring

confidence. However, banks do not seem ready to trust each other. M TRICHET confirmed

that banks prefer to obtain loans from and repay the ECB, even for very short periods. M

GARCÌA-MARGALLO (PPE, ES), Mrs WAGENKNECHT (GUE, DE) and M RYAN

(UEN, IE) highlighted the need to restore credit; banks are apparently not using the public

funding they received. M TRICHET observed that the lower EURIBOR interest rates show

that some benefit is passed on to citizens (mortgages are usually linked to EURIBOR). As

regards inflation resulting from the low cost of money, M TRICHET said to Mrs FERREIRA

that we have a solid anchoring of inflation expectations. It is urgent, at present, to revive the

financial market. The financial market is not to be opposed to the real economy, as M

GOEBBELS (PSE, LU) argued: in Luxembourg, for instance, it provides a number of jobs.

M TRICHET confirmed to Mrs STARKEVICIUTE (ALDE, LT) that the crisis would trigger

a lot of restructuring in the financial sector. Mrs LULLING (PPE, LU) asked whether the

ECB could extend its powers of supervision and if this would be a problem for Member

States outside the Euro. M TRICHET noted that the Treaty already authorises the Council to

extend the powers of supervision of the ECB. The de Larosière report may be useful on this

aspect.

  • 3. 
    Exchange of views with Commissioner ALMUNIA

As a point of order, Mr. SCHINAS (PPE-ED/EL) objected to the fact that the Commissioner

was only informing the European Parliament after he had given a press conference on the

economic forecasts the previous day, and all the details had already been published in the

press.

Mrs. BERES replied that prior information to the European Parliament was not always

possible since ECON met only a couple of times a month.

Mr. ALMUNIA said that the release of economic forecast figures had been advanced in order

to respond to the actual needs caused by the economic and financial crisis which required

significant efforts from Member States to stabilise the situation.

Although the figures for the next six months were not very favourable, these might slowly

become better from the second half of 2009 onwards when the full effects of the current

measures would be measurable. The decrease in investment and consumption means that the

crisis now also affects the real economy, with significant job losses. He said that it was

however obvious that the crisis would have a longer impact on Member States' budget then it

would affect the real economy. The actions taken by Member States which are coherent with

Commission and Council proposals and conclusions would, in addition to actual financial

input, require additional structural measures.

Nevertheless, the European Stability Pact on fiscal and budgetary policy needed to be

respected and the Commission intended to adopt its opinion on Member States' excessive

budget deficit mid-February for submission to the ECOFIN Council of 10 March. It was

expected that 7/8 Member States would receive a notification of non-conformity.

He said that the next European Council would fine-tune the strategy on the crisis adopted in

December 2008, that an expert group had been established (DE LAROSIERE) and that the

Commission and the Council would participate in the different Working Groups preparing the

G-20 meeting in London on 2 April 2008.

Mrs. FERREIRA (PSE/PT), who is rapporteur on the European Economic Recovery Plan, said

that the programme had been launched before recent figures were available and that the

situation now looked even worse. She further emphasised the difficulties of coordinating all

national initiatives and called for a more concerted approach. She asked the Commissioner if

there was already a second planning phase foreseen and warned that the launch of procedures

against Member States who had violated the stability pact would lead to further loss of

credibility and jobs.

Mr. GARCIA-MARGALLO (PPE-ED/ES) raised the question of why figures from the

Commission and the national authorities sometimes varied by up to 1% and asked how the

Commission could assist Member States in returning to the thresholds of the stability pact

and/or whether these should be revised since more and more Member States are unable to

meet the criteria.

Mrs. STARKEVICIT (ALDE/LT) wanted to know the Commissioner's view on cyclical

capital flows and said that smaller Member States have more difficulties in borrowing money

then the bigger ones.

Mr. ORTUONDO LARREA (ALDE/ES) wanted information on the Commission assessment

of past recovery operations on the prices for oil and food. He further stated that financial

institutions were likely to pay their US debts using EU taxpayers' money and citizens' savings.

Mr. DAIANU (ALDE/RO) said that the crises had already been forecast by several well

informed sources. He further regretted that countries which already have large deficits would

have less room for action then others and asked the Commission to expedite rapidly its

contributions under the different community financing instruments which could also

contribute to new impetus.

In response to this first series of questions, Mr. ALMUNIA stated that the current forecast is

indeed worse the initially foreseen but that a serious assessment of the impact of the

December 2008 decisions could only be made at a later stage: Member States were either still

working on the concrete implementation of their plans or these plans had still to be adopted by

national parliaments.

He said that all measures had been taken with the objective of not distorting the Internal

Market and should reflect a longer term vision, whilst having short time effects. The most

urgent thing to do in his view was to re-establish the credit flows to companies and households

which had become difficult since financial players did not want to take new risks. As regards

the stability pact, he was clear that this should be respected since the pact itself contains

sufficient flexibility to manage difficult situations.

He explained that more important differences in forecast figures were only identified in

forecasts over the longer term since the longer the forecast, the less relevant data were

available. He said that he was open to the possibility of enhancing Community funding but

emphasised that the initial solutions, including those creating more budgetary room, should

come from Member States' governments themselves. These should include the creation of a

business environment favourable to capital import. Mr. ALMUNIA also stated that the

Commission did indeed have evidence that primary markets had been subject to speculation

but that the pressure on food and oil prices has now dropped significantly.

He also said that inadequate regulation of financial markets, the failure of supervision and

defective appreciation of risk created greater problems then initially assessed.

Mr. VISSER (PPE-ED/NL) supported the retention of the stability pact in its current form;

excessive budget deficits should not be allowed to be carried over 2 years.

Mr. BULLMANN (PSE/DE) questioned the Commission's opinion on the effect of the credit

crunch on companies.

Mr. SCHINAS raised the question whether the composition of the Commission with a split of

the portfolio on "economic affairs" and "institutions" was not a mistake and was curious to

know what the Commission would request in concrete terms from those Member States not

respecting the stability pact.

Mr. GAUZES asked that the opinion of the expert group (DE LAROSIERE) be sent to the

European Parliament before any conclusions were drawn up.

Mr. HOKMARK (PPE-ED/SE) suggested that since there is a clear need for capital flows and

stability, it could be a good idea to review the capital adequacy Directive requirements.

Mr. SKINNER ( PSE/UK) questioned whether the expert group of Mr. DE LA ROSIERE was

really necessary since there is already so much expertise around; he was concerned that this

group would have powers outside the reach of democratic scrutiny.

Mr. BECSEY (PPE-ED/HU) also requested reports to be presented to the European

Parliament before they were released to the press and he also asked for more EU involvement

in IMF control missions.

Mrs. BERES concluded this short question round by asking whether in the new Commission

all financial institutions and economy-related files would be regrouped in one portfolio and

said she would like to hear about further plans if the situation were to deteriorate further.

Mr. ALMUNIA responded briefly to these questions by stating again that the stability pact

would apply and that the Commission could make independent judgements on whether the

criteria were met or not.

On the effect of the credit crunch on companies he said that different Member States were

facing different problems but that there was clearly a shortage of credit. On the

Commissioners portfolio he suggested that this would be taken up with the new President of

the Commission and that the DE LAROSIERE expert group would look at issues which go

beyond those being examined by existing expert groups. He would return to the subject of the

deficit procedures for Member States on a subsequent occasion.

III. Examination of reports as leading committee

  • 1. 
    Proposal for a Council Directive amending Directive 2006/112/EC as regards reduced rates of value added tax (COM (2008) 428 - doc. 11615/08 - 2008/0143 (CNS)) Rapporteur : Ieke VAN DEN BURG [PSE, NL]

Consideration of amendments (doc. EP 418.064)

Mrs VAN DEN BURG explained that, according to the amendments submitted, there seems to be clear support for the Commission's proposal as regards reduced rates of value added tax

(VAT), in particular for labour-intensive services.

The rapporteur said that there were some amendments tabled by the Greens related to reduced VAT rates which should apply to some products or services aimed at reducing the use

of energy. As commissioner Kovács had announced a proposal on that topic, she suggested

leaving these amendments aside for the time being. Mrs BÉRÈS was not of the same opinion.

She considered that the European Parliament should express itself on that topic before the

European elections.

The representative of the Commission announced that the proposal in question should be ready by the end of March or beginning of April.

Indicative timetable :

  • - 
    vote in committee : 2 February 2009
  • - 
    vote in plenary: February II 2009 (in order to allow the ECOFI Council to adopt it in March 2009)
  • 2. 
    Proposal for a Regulation of the European Parliament and of the Council on crossborder payments in the Community (COM (2008) 640 - doc. 14308/08 - 2008/0194 (COD)) Rapporteur : Margarita STARKEVICIT [ALDE, LT]

Consideration of amendments (doc. EP 418.041)

Mrs STARKEVICIT briefly commented on the amendments to her report.

She said she did not understand the amendment of Mrs FERREIRA aimed at maintaining the collection of data for statistical purposes.

The representative of the Commission said he shared the rapporteur's concerns about this amendment and added that the collection of data was very expensive. Moreover, he indicated

that, for the time being, only six Member States still collect such data.

Indicative timetable :

  • - 
    vote in committee : 11 February 2009 - vote in plenary : March 2009
  • 3. 
    Proposal for a Directive of the European Parliament and of the Council of on the taking up, pursuit and prudential supervision of the business of electronic money institutions, amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (COM (2008) 627 - doc. 14201/08 - 2008/0190 (COD)) Rapporteur : John PURVIS [PPE-DE, UK]

Consideration of amendments (doc. EP 418.029)

According to Mr PURVIS, the topic is very technical. Many amendments were tabled. He is of the opinion that compromise amendments will be possible. Regarding the amount of initial

capital, he explained that there were different proposals but he added that he preferred the

amount of 125.000 , as suggested by the Commission.

The representative of the Commission said it could accept to request a higher amount of initial capital.

Indicative timetable :

Consideration of amendments (doc. EP 416.671)

Mr BECSEY indicated that he was going to suggest a figure between 64 and 90 as a minimum level for excise duty per 1000 cigarettes for all Member States.

Mrs LULLING [PPE-DE, LU] pointed out the fact that, if the excise duties on cigarettes are too high, than the consumers tend to use counterfeit or contraband products, with the risks

they can provoke.

Indicative timetable :

  • - 
    vote in committee : 11 February 2009
  • - 
    vote in plenary : March I 2009
  • 5. 
    Proposal for a Regulation of the European Parliament and of the Council on Credit Rating Agencies (COM (2008) 704 - doc. 15661/08 - 2008/0217 (COD)) Rapporteur : Jean-Paul GAUZÈS [PPE-DE, FR]

Consideration of draft report (doc. EP 418.199)

According to Mr GAUZÈS, the proposed registration and regulation system will be complicated and ineffective. At the moment, there are only three rating agencies. The

rapporteur considered that a European regulatory system is necessary and that registration and

regulation of the credit rating agencies should be centralised and carried out in close

cooperation with national authorities. Mr GAUZÈS felt that the agencies should not have a

double function i.e. rating and advice. Regarding the credit ratings issued by rating agencies

established outside the EU, the rapporteur suggested that these credit ratings could be used if

a EU agency assumes responsibility for them and guarantees that the agency, which has rated

these products, respects guarantees equivalent to those existing in the EU.

This latter suggestion was considered by Mr KLINZ [ALDE, DE] to be heavy and costly. He suggested looking for a more flexible alternative. Mr LIPIETZ [Verts/ALE, FR] supported the

idea of a European rating agency. He pointed out that, at the moment, rating agencies are

paid by their clients. He was of the opinion that another system should be put in place (for

instance, payments should be made to a central pool which would pay the rating agencies).

According to Mr LAUK [PPE-DE, DE], the Commission's proposal goes in the right

direction. He added that international norms were needed (not only European or American

ones). He also suggested collecting statistics on the results of the rating agencies in order to

be able to establish their reliability. Mr PURVIS [PPE-DE, UK] wondered if the

Commission's proposal was useful at all. He suggested not engaginh in this heavy work. The

fact that the work will be hard is not a reason for not doing it, according to Mrs BÉRÈS. She

stated that one part of the work carried out by the rating agencies comes under the public

sector.

Therefore, she considered that the idea of public rating agencies should not be rejected. Mrs STARKEVICIT [ALDE, LT] stated she was also in favour of a regulation in this field and

she added that the Commission should evaluate the reliability of the agencies. Several MEPs

expressed doubts about the suggested experts' rotation in the rating agencies.

On this latter point, the representative of the Commission explained that the objective of this rotation was to avoid any conflict of interests. Regarding supervision, he pointed out that a

short-term solution was needed. He insisted on the importance of carrying out the work on

this file before the EP elections.

Indicative timetable :

  • - 
    deadline for tabling amendments : 10 February 2009
  • - 
    consideration of amendments : 9 March 2009
  • - 
    vote in committee : 20 March 2009
  • 6. 
    Report on an European Economic Recovery Plan Mrs FERREIRA drew attention to the small Community amount (EUR 30 billion) compared

with the national amount (EUR 170 billions) allocated to the plan. This may result in a lack of

territorial cohesion. A coordination of national recovery plans would therefore appear

essential. The drafter also emphasised the need for the plan to be consistent with the de

Larosière group Report, the need to review the Lisbon agenda, rethink the role of the ECB

and avoid protectionism. M. HÖKMARK (PPE, SV) considered that the emerging countries,

which originated the current crisis, may also offer the way out of it. Mrs Van den BURG

expressed the concern that Member States may build up an enormous public debt for future

generations.

  • 7. 
    Taxation of savings income in the form of interest payments

Rapporteur Mr. HAMOIR (PSE/FR)

ECO /6/69755 2008/0215 (C S) COM(2008) 0727

Consideration of draft report

The rapporteur presented the subject of his report, which was a revision of the existing

savings Directive, as a politically sensitive item which would affect the revenue of Member

States. In his opinion the proposal was going in the right direction but the revised Directive

should provide for better coverage of innovative instruments and he also criticised the lack of

provisions on the transitional period in which withholding taxes apply in those Member States

that do not participate in the information exchange system. He also questioned the efficiency

of this latter system as regards cost/efficiency and the difficulties of controlling adequate

implementation.

He outlined his proposals for amendments, including those to broaden the scope by lowering

the threshold for return on invested capital and those aiming to modify the different annexes.

He said the bottom line for him was that the system should be transparent and efficient in

order to combat tax fraud.

Mrs. LULLING (PPE-DE/LUX) suggested that the Commission proposal involved too much

mixing of technical and political issues and was not very clear in its objectives. She was not

convinced that the exchange of information system as currently operated was very effective

and she claimed that a withholding tax was much easier and more efficient to manage. In this

respect, she pointed out that the number of Member States applying this system for their

residents was growing and proposed that it be extended to cross-border payments.

She questioned the efficiency of a measure when the cost of its implementation was estimated

at EUR 700 M while the additional income generated was only EUR 1, 4 billion.

Mr. KLINZ (ALDE/DE) was surprised that, whereas billions of Euros of public money have

been allocated to support financial institutions, the Commission proposal was now trying to

tax every cent of taxpayers' savings.

He also criticised the fact that not all third countries were covered by the proposals, and

suggesting adding Delaware, where anonymous accounts can be opened, to the list of tax

havens.

Mr. LIPIETZ (Greens, EFA) agreed with the previous speaker and said that there was a

fundamental problem of legitimacy when capital income was taxed at 15% and labour at 45%.

Mrs. RAEVA (PPE-ED/BG) requested that better tactics be established to fight against tax

fraud and advocated closing all possible loopholes whilst asking for a better assessment of the

cost and administrative consequences of the inclusion of certain instruments in the scope of

the Directive.

Mr. KARAS (PPE-ED/AT) stated that loopholes needed to be closed and agreed on

broadening the scope, but asked why withholding taxes had been excluded from the outset.

According to him, Member States do not want to modify the Directive in force but he was

opposed to giving further "gifts" to financial institutions. To him it looked strange that,

according to a CEPS study, withholding tax was a very efficient means of taxing savings and

more and more Member States use withholding taxes; at the same time, a EU-wide

withholding tax seemed impossible to implement.

Mrs. BERES referred to a previous ECON workshop which had already discussed this item

exhaustively and asked that this discussion not be repeated before giving the floor to the

Commission.

The representative of the Commission acknowledged that the taxation of savings was a

technically and politically complex issue but said that, in his opinion, the proposal had been

properly prepared and now reflected a fair balance.

On the transitional regime for Member States which do not participate in the information

exchange, he said that now that G-20 and OECD also favour such a system, the transitional

period would expire as envisaged.

On the proposed amendments to modify the annexes he said that care should be taken to

exclude all vehicles that could evade the provisions of the Directive and that a comitology

provision was envisaged to react quickly to new instruments. He invited the rapporteur to

hold discussions on this issue.

Deadline for amendments: 09 February 2009

Discussion and vote in ECON: 30-31 March 2009.

  • 8. 
    The collection of statistical information by the European Central Bank

ECO /6/68480 2008/0807 (C S)

Rapporteur: Mrs. PIETIKAI E (EPP-ED/ SE)

Consideration of draft report

The rapporteur described briefly the features of the two European statistical systems

(Commission and ECB) and highlighted the importance of confidentiality, quality and the

exchange of information in statistical matters.

Mr. dos SANTOS (PSE/PT) emphasised the importance of statistics for economic forecasting

and policy preparation and said that there were close ties between banking and statistics. He

thought the report reflected the required balance between confidentiality and transparency.

The representative of the ECB welcomed the report and agreed with the previous speaker and

the need for a balanced approach. She said that the current financial crisis illustrated well the

need for high quality statistics to help in reaching important policy decisions. Nevertheless

she invited the rapporteur to drop her second amendment so as to maintain flexibility on

future statistical reporting requirements.

  • 9. 
    White Paper on damages actions for breach of the EC antitrust rules.

ECO /6/62760 2008/2154 (I I) COM (2008) 0165

Rapporteur: Mr. LEH E (PPE-ED/DE)

Consideration of amendments

The rapporteur introduced the various amendments which cover, inter alia, the extension of

possible action to SMEs, third party involvement (arbitration/Ombudsman), opt-in/opt-out

clauses, class actions and access to documents.

He said that the EU should not simply copy the system in force in the US but look for a

synergy of systems already in force in the Member States.

He also referred to the different European initiatives taken in respect to class actions which,

considering the sectoral differences, are not always compatible and he favoured a horizontal

approach on which also the European Parliament could have a substantial influence (co-

decision). He invited shadow rapporteurs to draft together compromise amendments.

Mr. GAUZES (PPE-ED/FR) fully agreed with the proposal to distance the provisions from

the US system to which he favoured an appropriate EU response. He further supported the

rapporteur in his query to have the legislative proposals discussed under the codecision

procedure which required an additional legal basis. He also thought that information access

was very important. Identification of individual cases in collective actions should be left to

Member States. In his opinion, the burden of proof should be on the plaintiffs but this could

be reversed in cases in which the company was already under an infringement procedure. He

also expressed the idea that the link between fines and compensation should not be

mechanical but that fines should be looked at as an incentive for paying compensation.

Mrs. BOWLES (PPE-ED/UK) welcomed the report but suggested that alternative dispute

resolution should be mandatory. She thought that the application of the "non bis in idem"

principle could be difficult without the cooperation of the competition authorities and was

also in favour of codecision once the legislative instrument had been tabled.

The representative of the Commission agreed on the need for coordination of the different EU

actions but, considering the specificities of each sector, he was more in favour of similar but

specific instruments to better address the issues at stake.

Vote in ECON: 10 February 2009

IV. Consideration of reports as opinion-giving committee

  • 1. 
    The state of Transatlantic relations in the aftermath of the US elections (2008/2199 (INI))

Draftsman : José Manuel GARCA MARGALLO Y MARFIL [PPE-DE, ES]

Consideration of amendments (doc. EP 418.150)

Mr GARCIA MARGALLO said he has proposed compromise amendments.

Indicative timetable :

  • - 
    vote in committee : 2 February 2009
  • 2. 
    Proposal for a directive of the European Parliament and of the Council on the application of patients' rights in cross-border healthcare (COM (2008) 414 - doc. 11307/08 - 2008/0142 (COD)) Draftsman : Harld ETTL [PSE, AT]

Consideration of amendments (doc. EP 416.293)

Mr ETTL recalled that the starting point was the patient's right to recieve medical treatment in another Member State. He said that, according to the Commission's proposal, the

reimbursement of the costs has to be done by the Member State of affiliation.

Mrs In't VELD [ALDE, NL] indicated that this proposal for a directive should cover not only the possibility of being treated in another Member State but also the freedom to provide

services. Mrs LULLING [PPE-DE, LU] said that it is important not to disorganize the health

systems of the different Member States. In this regard, she considered that the prior

authorisation system was essential. She also added that Member States should have a room

for manoeuvre in order to allow them to handle the flow of patients.

The representative of the Commission explained that the Commission's proposal was based on the case law of the Court. The objective was to complete what already exists. He indicated

that for non-hospital care, there is no need to request a prior authorisation. He added that it is

up to the Member States to define the treatment and the reimbursements for which the patients

can claim. The Commission's representative said that a Community definition of hospital care

would be useful in order to clarify the situation. He added that the Commission is not going

to define the list of the hospital care on its own; a committee, in which the Member States and

the European Parliament will be involved, will establish this list.

Indicative timetable :

  • - 
    vote in committee : 11 February 2009 - vote in e E VI committee: 12 March 2009
  • - 
    vote in plenary : April 2009

3.

Proposal for a directive of the European Parliament and of the Council amending Council Directives 77/91/EEC, 78/855/EEC and 82/891/EECand Directive 2005/56/EC as regards reporting and documentation requirements in the case of merger and divisions

(COM (2008) 576 - doc. 13548/08 - 2008/0182 (COD)) Draftsman : Gay MITCHELL [PPE-DE, IE]

Consideration of draft opinion (doc. EP 418.080)

Mr MITCHELL welcomed the Commission's proposal as it aims to reduce undue administrative burdens on European companies. This proposal takes into account the

concerns expressed by the European Parliament in its resolution of 21 May 2008. Therefore,

the rapporteur indicated that, according to him, there was no need to table amendment to the

Commission's proposal.

Indicative timetable :

  • - 
    deadline for tabling amendments : 30 January 2009 at 12.00 - consideration of amendments and vote in committee : 11 February 2009
  • - 
    vote in JURI committee : 31 March 2009
  • - 
    vote in plenary : April 2009
  • 4. 
    Minimum stocks of crude oil and/or oil products

ECO /6/69900 2008/0220 (C S) COM(2008)0755

Rapporteur: Mr. BI EC ( I/BG)

Consideration of draft opinion

Only the rapporteur intervened to support the Commission proposal which he said was very

topical. He stressed the need to avoid a new oil crisis, an objective which, however, should

not lead to an excessive burden on Member States. He also said he would table some

amendments.

V. Date and place of next meeting

Monday, 2 February 2009 in Strasbourg.

___________________

ANNEX I

Dear Madam President, Dear Members, Ladies and Gentlemen,

It is a great pleasure for me to appear before you today in order to present to you the priorities and aims of the Czech Presidency in the areas of finance and economy.

To begin with, let me stress that the success of the Czech Presidency will depend on good cooperation with the European Parliament in all areas, and particularly in issues which are governed by the co-decision procedure. As regards the remit of the ECOFIN Council and your committee, the area concerned is the financial services agenda in which a range of important legislative proposals are under way. This means that we are going to work together a lot over the coming months. I strongly believe that we will be able to fulfil the expectations connected with this legislation and finalise the highest possible number of proposals to the benefit of European businesses and citizens.

My November meeting in Prague with a delegation from this committee, which is still fresh in my memory, gave me a range of interesting ideas for my work in my new role of President of the ECOFIN Council. This is why I am very much looking forward to our exchange of views today which, I believe, will be no less enriching. Another opportunity for a wide-ranging discussion will be the `troika' meeting with representatives of your committee which is scheduled for 9 February 2009.

Now I would like to turn to the agenda of the Czech Presidency in the field of financial and economic affairs. I would like to point out that this agenda was prepared in close cooperation with the French Presidency ­ on the results of which we will be building ­ and with the Swedish Presidency for whose work I hope we will establish a good foundation.

As you know, economy is one of the three priority areas of the Czech Presidency as a whole, not only of the ECOFIN Council. This is no surprise. The Czech Republic has taken over the Presidency in difficult times, when after years of prosperity the current financial crisis has brought economic slowdown to the whole of Europe and a number of countries are facing serious recession. In cooperation with other countries, the Czech Presidency will give its greatest attention to measures which will help mitigate the impact of the crisis on European businesses and citizens. At the same time, and even more importantly, our aim will be to ensure that the Europe which emerges from this crisis is stronger and more competitive. In other words, we aim to ensure that the steps we take are taken in consideration of the long-term perspective and lay the foundations of sustainable growth and job creation after the crisis has passed. As regards economic themes, the reform of the international financial architecture is high on the Presidency agenda. Another G20 summit will take place in April and to prepare the EU for this summit will be for us a task of paramount importance.

Allow me now to talk in detail about the plans of the Czech Presidency in the three main areas within the remit of the ECOFIN Council, namely:

  • - 
    economic policy
  • - 
    financial stability and financial services - taxation

Economic Policy

As you know, two days ago the European Commission published a new forecast in which it again revised downward its estimate for growth for this year and next year. The Commission's forecast is known to you and so I will only refer to this text by observing that it makes very unpleasant reading, even though we all had expected the outlook to deteriorate. Personally, I am most concerned about the badly functioning credit market and the expected rise in unemployment.

Understandably, in these circumstances the ECOFIN Council has great responsibilities. ·

Fortunately, already the December European Council responded to the current developments by adopting the European Economic Recovery Plan. The Czech Presidency can therefore concentrate on its implementation.

To implement this Recovery Plan, I believe it is essential - and we had a wide ranging and ·

very lively discussion about this in the Council yesterday ­ that we continuously evaluate the effectiveness of the measures being taken. We have to keep asking ourselves whether the measures really can or could decelerate the growth of unemployment, support demand and boost economic growth. At this moment I consider this to be of much greater importance than the amount of financial resources which we, as governments, put at the disposal of our economies.

· Closely related to this is the question of the functioning of the credit markets. Signs are

appearing that some companies are beginning to have serious problems securing accessible finance. We have to ensure that these channels start working well again and that the normal way of financing the real economy by banks is restored. If this does not happen, the effect of the measures to support the financial sector will be zero for companies and citizens and the fiscal expenditure on its own will not save our economies.

· Personally, I believe it is vital that the fiscal measures adopted are timely, short-term and

temporary and that there is a rapid return to budgetary discipline and valid medium-term targets once the crisis is over. The current economic crisis was caused by a crisis of confidence in the financial markets. I believe that we should not increase the uncertainty of economic entities through irresponsible fiscal policies. After all, there have already been some warning signals from the treasury securities market where there have recently been several unsuccessful issues. This is a new phenomenon in the current crisis and we will have to closely monitor developments on these markets.

· As regards budget discipline, a lot has been written about its future in the EU over the last few

months and some have advocated the abandonment of the Stability and Growth Pact. I would like to say here that the Czech Presidency considers the Stability and Growth Pact to be the cornerstone of our budget policies which must not be questioned. After the reform of 2005, the pact now offers a framework for bad as well as good economic times. We obviously cannot expect, either this year or next year, to be able to achieve equally good budget results as in a period of economic growth. When evaluating the stabilisation and convergence programmes we will abide by the rules of the Pact, including the flexibility which it allows. Recommendations on these programmes will follow the same goal as before, i.e. a return to sustainable budget figures. In cases where the conditions of the Treaty and the Pact have been met, the Council will instigate the excessive deficit procedure. Understandably we must be realistic and take into consideration the time scale of the economic recession, but the rules will be applied as they stand.

· This year's evaluation of progress with the Lisbon Strategy will be influenced by the

economic crisis. I believe that the long-term priorities for the direction of structural reforms were well chosen and remain valid. While preparing recommendations for each country we will, in cooperation with the Commission, endeavour to take into account current proposals and the optimal integration of the Recovery Plan. Nevertheless it is a fact that the problems linked with the ageing population or the pressure of globalisation, for example, have not diminished with the financial crisis and we must continue to identify measures which strengthen our economies in the long term.

The Czech Presidency will emphasise the continuing process of structural reform. It is ·

necessary to strengthen the development of competitive industrial sectors, support measures to achieve a suitably qualified workforce, and implement further policies which will enable the unemployed to return to the labour market as soon as the crisis is over.

Our main task will be to prepare the spring session of the European Council in cooperation ·

with other Council bodies. I would like this year's Key Issues Paper (KIP) of the ECOFIN Council for the spring session of the European Council to genuinely focus on current issues. It will be concerned above all with the renewal of growth, employment and the pressing questions of financial stability, including international aspects. Further, apart from a report on the Lisbon Strategy, the ECOFIN Council will prepare contributions concerning the easing of the administrative burden on companies, the revision of the internal market and international financing of the fight against climate change.

· As I mentioned earlier, even in the current difficult situation we should not lose sight of the

long-term aspects of public finance. We will discuss the effects of the ageing population and the possible implications for our budget targets. We will also pay attention to the quality of public finance ­ especially trends in the structure of public expenditure.

One specific contribution of the Czech Presidency will be a discussion about the economic ·

costs and benefits of the enlargement in 2004, which we have planned for the occasion of the 5th anniversary of this enlargement. On 2 March a conference will take place in Prague on that topic. Conference participants will evaluate the implications of enlargement in three areas ­ macroeconomic stability, the labour market and competitiveness. Their findings will serve as a starting point for discussions among ministers at several informal meetings, including the ECOFIN Council.

Financial Services

· As I said earlier, the Czech Presidency will pay great attention to the situation on the financial markets and to improving the conditions in which the markets operate, not only in Europe but worldwide.

· First of all I would like to mention the continuing work within the framework of the G20

group. The EU is represented in this group by the President of the Council and our Presidency is determined to do everything necessary to ensure high quality and a coordinated preparation of the common position of the EU in meetings at all levels and, particularly, for the G20 summit which will be held on 2 April in London. In this matter we are working in cooperation with the Commission and colleagues from the Council, so the interests of all 27 Member States of the EU are fully represented.

· At the last G20 summit in Washington, an ambitious action plan was laid out with a number

of measures to strengthen transparency and accountability, improve regulations, support the integrity of the financial markets and strengthen international cooperation. This plan includes a whole range of questions which are currently being resolved within the EU, some of them as part of the road maps adopted by the ECOFIN Council in 2007.

· I therefore believe that the Union is in a good initial position to decisively influence the future

shape of the global financial system, and the Czech Presidency will do its best to ensure that the EU retains its leading position at G20 sessions and contributes to the fulfilment of the adopted action plan.

· The focal point of the work of our Presidency will be above all to strengthen the financial

stability of the EU, which is an essential prerequisite for our economies to function properly. Therefore, we will continue to implement and update the road maps adopted in response to the financial turbulence. At the same time we will monitor developments in the financial markets and, if necessary, coordinate additional measures at European level.

· Nevertheless, the main target remains drawing conclusions from our recent experience and

preventing a similar financial crisis developing in the future. One very important lesson from the crisis of last autumn is that coordination between Member States is of key importance. We must avoid situations in which neighbours can harm each other. I am convinced that despite some initial difficulties we have managed to achieve that.

· The basis of financial stability is effective supervision of the financial markets. To prepare

proposals to strengthen the European supervision regime, the Commission recently established a group of specialists with Jacques de Larosière as president. The results of the work of this group, which are expected at the end of February, will be used by our Presidency in discussions relating to reforms of the supervision of financial markets in the EU at our informal ECOFIN session in Prague in April.

· We will endeavour to ensure that proposals regarding possible changes to the supervision of

cross-border financial groups are supported by appropriate risk analyses of the suggested system, not only from the point of view of the country of origin but also of the host country. I am aware of the fact that your committee has already been working intensively on this key question for some time and I very much appreciate all of your contributions on this topic.

· There are also several legislative proposals connected with strengthening the stability of

European financial institutions. Finalising them has become a task for the Czech Presidency. Completing this task is a high priority for us, especially as far as the proposals connected with the revision of the protection framework in banking and insurance are concerned ­ in other words the directives on capital requirements (CRD) and Solvency II.

· This brings us to an area where, above all, intensive cooperation with the European

Parliament and in particular with your committee will be of key importance for us. We have a lot of work ahead of us which we will have to complete together in a relatively short time.

· Significant progress has been made in the Council and also in the European Parliament on the

proposals I have already mentioned and on the recently proposed regulation on credit-rating agencies. Approval of the proposals will require a constructive approach and willingness to compromise on both sides. I strongly believe that our joint negotiations will be held in this spirit.

· Another area of our common legislative work will be payment services. Here the Czech

Presidency will concentrate on amendments to the regulation on cross-border payments in euros and the e-money directive, which we consider an important tool for the further development of this sector in the EU with clear benefits for its citizens. As regards these two proposals, I also hope we can find a compromise with the European Parliament by April 2009 at the latest.

Taxes

· Our main priority in the area of taxes will be the fight against tax evasion and the avoidance

of tax obligations. In connection with these priorities steps are necessary to improve the efficiency of the tax administration of the Member States and their cooperation. I believe it is a goal shared by all Member States and that we will also be able to make progress in this area.

· As regards indirect taxation, the Czech Presidency will focus primarily on the draft VAT

directive put before the Commission in December 2008. This draft regulates the import of tax-free goods and the joint and several liability of companies or individuals in the case of unpaid tax when goods are delivered to another Member State. At the same time we will be working on a proposal for a directive concerning reciprocal assistance between Member States in the recovery of unpaid taxes.

· In the case of direct taxes we will continue to work on the revision of the directive on taxable

interest on savings. This directive should remove loopholes in the current legislation. We will also support the European Commission when negotiating treaties concerning the exchange of information with third countries about income from savings.

· The second aim of the Czech Presidency in the field of taxation connected with our priority of

removing barriers in the internal market is the modernisation and simplification of tax rules. In that respect we will strongly support the approval of the amendment to the directive governing consumer tax applied to tobacco products. We will also continue our work on proposals regulating VAT issues in the area of financial and insurance services.

· Further concerning VAT, the Presidency will put all its efforts into completing the task

imposed in December by the European Council to solve, by March 2009, the question of applying lower rates in some sectors. We will resolve this question in the context of the European Economic Recovery Plan. We are planning in-depth discussions on the matter at the February ECOFIN Council session. The Presidency will strive to find a solution, although we cannot deny that it is a complicated task.

Ladies and Gentlemen Thank you for your attention and I look forward to your questions.

ANNEX II

Madame la Présidente, Mesdames et Messieurs les membres de la Commission Economique et Monétaire, je me réjouis de ce premier échange de vues avec votre Commission en 2009. Cet échange a lieu quelques jours seulement après la réunion du Conseil des Gouverneurs du 15 janvier consacrée à la politique monétaire. De surcroît, mardi dernier à Strasbourg lors de la session plénière dédiée aux dix ans de l'euro, j'ai été heureux de noter le soutien de votre Parlement à l'euro et à la BCE. Aujourd'hui, comme le veut la tradition, je commencerai mon intervention par une évaluation de la situation économique et monétaire, en expliquant les raisons sous-jacentes de nos récentes décisions relatives aux taux d'intérêt. Im Anschluss daran möchte ich einige Worte zum Preisausblick sagen, wie er sich im Eurogebiet darstellt. Und schließlich werde ich auf Fragen der internationalen Finanzarchitektur eingehen. Dieses Thema wird in den nächsten Monaten gewiss noch weiter an Bedeutung gewinnen.

  • 1. 
    Economic and monetary developments

Since my previous appearance before the European Parliament on 8 December the economic outlook in the euro area has continued to weaken and inflation has declined further. In December 2008 the inflation rate stood at 1.6%. Moreover, inflationary pressures and inflationary risks have continued to diminish. Looking ahead, with the appropriate medium-term perspective for monetary policy and taking also into account our own policy decisions including the most recent one, we expect euro area inflation to remain in line with our definition of price stability over the policyrelevant horizon. Risks to price stability over the medium term are broadly balanced in the view of the Governing Council of the ECB.

As regards economic developments, since September last year the financial turmoil has intensified and broadened. Tensions have increasingly spilled over from the financial sector into the real economy. Looking ahead, both global demand and euro area demand are likely to remain dampened for a protracted period. At the same time, declining inflation rates should support real disposable income in the period ahead, and the euro area economy should benefit from the broad and farreaching policy measures that have been decided upon over recent weeks.

However, this outlook remains surrounded by exceptionally high uncertainty. Overall, risks to economic growth remain clearly on the downside. They relate mainly to the potential for a stronger impact of the financial turmoil on the real economy as well as to concerns about the possible emergence and intensification of protectionist pressures and to possible adverse developments in the world economy stemming from a disorderly correction of global imbalances.

To lay sound foundations for sustainable growth, all parties concerned should live up to their responsibilities. In this respect, it is crucial to maintain discipline and a medium-term perspective in macroeconomic policy-making. To pursue a stability-oriented and sustainable policy approach is the best way to preserve and enhance confidence. The significant measures being implemented by governments to address the financial turmoil should support trust in the financial system and ease constraints on credit supply to companies and households.

Monetary trends in the euro area support the view that inflationary pressures are diminishing. Notably, the latest evidence confirms a moderating rate of monetary expansion. The Governing Council has repeated its commitment to keep inflation expectations firmly anchored in line with its definition of price stability of below, but close to, 2%. This supports sustainable growth and

employment and contributes to financial stability. It is against this background that the Governing Council decided last week to reduce the interest rate on the main refinancing operations of the Eurosystem by a further 50 basis points to 2%, bringing the total reduction since 8 October 2008 to 225 basis points.

  • 2. 
    Medium-term price developments and the process of disinflation

Let me now look more closely at the medium-term outlook for price developments in the euro area, and in particular at the process of disinflation we are currently observing. I will thereby address the first topic proposed. It is essential here to draw a clear distinction between disinflation and deflation.

Disinflation is a process of falling inflation rates. This process often stems from cost-saving developments on the supply side or terms of trade improvements. Such developments can sometimes go hand in hand with negative demand shocks as is the case at present. However, they are per se benign in nature. This is because they sustain real incomes. In the current context, we are witnessing a process of disinflation in the euro area, mainly as a result of a sharp fall in oil and commodity prices. To that extent it is therefore a welcome development. The spike in oil and commodity prices that began in 2007 and lasted until mid-2008 was both inflationary and contractionary. In consequence, the recent decline in these prices is both disinflationary and expansionary. By way of example, car fuel prices fell by 15.4% in December 2008 year on year. Their weight of almost 5% in the HICP basket means that this explains a significant part of the recent inflation decline. If such favourable supply-side developments are especially vigorous, disinflation can even temporarily lead to negative inflation rates. It is therefore very important in such circumstances to keep medium-term inflation expectations well-anchored.

A deflationary process, by contrast, is a persistent and self-reinforcing decline in a very broad set of prices. This spiral is propagated by anticipation of prices declining further in the future. Such negative inflation expectations mean that investment and consumer demand is postponed, which would cause a second-round demand shortfall and put further downward pressures on prices.

There is presently no threat of deflation. Indeed, the firm anchoring of inflation expectations ­ to which we are so fully committed ­ represents the strongest and most reassuring safeguard against any risk of a downward spiral of inflation and inflation expectations.

From all these considerations you will understand that what we are currently witnessing is a process of disinflation, driven in particular by a sharp decline in commodity prices.

  • 3. 
    International financial architecture

Let me now turn to the second topic we selected, namely the international financial architecture. I consider that the fragility of the global financial system, by which I mean its lack of sufficient resilience that has been revealed in the course of the present episode of turbulences, is not acceptable. We must draw all the lessons of the crisis, without any complacency, considering that all the elements of the system must be significantly improved: the quality of risk management, liquidity management and the overall resilience of private institutions, the transparency of the financial markets, and the clarity of financial instruments.

As already underlined on the occasion of previous hearings in front of you, this calls first for much more transparency, without any consideration of vested interests; second for much less shorttermism in the decision-making processes, contrary to the most recent trends; and third for a systematic elimination of the procyclical aspects of our regulatory, prudential, accounting and taxation rules, which are amplifying considerably the fluctuations that are inherent in the functioning of market economies.

The Financial Stability Forum (FSF) has identified the main avenues for such reforms. What we now need is strategic lucidity and, where appropriate, a great deal of political energy to counter considerable vested interests. The G20 and the IMF are and will be decisive in this respect.

But a much better functioning of the financial sphere does not suffice. We also need sound macroeconomic policies that are sustainable in the medium and long run. In particular, we need to avoid the creation of the large domestic and external imbalances which are very much at the root of the present difficulties. An effective surveillance of macroeconomic policies of the major systemically important economies is of the essence. Only the IMF can perform this decisive function, provided its mandate is strengthened.

In terms of institutional set-up, we need two major improvements:

First, the international financial architecture requires a strengthening of the informal groupings, in particular the FSF and the G20. The FSF is unique in that it links all the authorities and institutions that have a systemic influence on financial markets, which are very largely decentralised and ­ for many of them ­ independent from the political sphere. The necessary enlargement of the FSF is key. Particularly important in a time of global crisis has been the new authority of the G20, which is a truly global informal grouping in comparison with the G7, which itself continues to be useful in a situation where the turbulence comes from the industrialised countries. ·

Second, on top of the IMF's strengthened surveillance mandate, the governance of the international financial institutions, particularly the IMF but also the World Bank, should become more effective and representative. In particular, a full representation of emerging market economies, commensurate with their importance in the global economy, is indispensable. ·

***

By way of concluding my introductory remarks, I would like to stress two points.

First, as regards euro area policies, persistent wage growth differentials, induced by structural inefficiencies or misaligned national policies, including wage-setting policies, might have adverse implications for the cost competitiveness of individual countries. National authorities have the responsibility to address competitiveness losses accumulated over recent years by implementing structural reforms and ensuring more moderate price and wage developments. Regarding fiscal policies, we welcome the European Council's reconfirmation of its full commitment to sustainable public finances. The current economic situation calls for prudence with regard to the adoption of extensive fiscal stimulus measures, taking into account the particular fiscal situation in each country. As I have said before, countries can use all the room for manoeuvre provided by the Stability and Growth Pact but only the room for manoeuvre that is in the Pact. The significant fiscal loosening and the implied increase in government debt should in no case risk undermining public confidence in the sustainability of public finances, thereby detracting from the effectiveness of a fiscal stimulus.

Second, I should like to turn briefly to financial supervision issues. The financial crisis has heightened the importance of addressing issues relating to financial supervision in a comprehensive and coordinated manner, both globally and at the European level.

As regards the European level, the crisis has highlighted the need to analyse long-term solutions to the structure of supervision. To that end, the proposals which will be put forward by the High-Level Group chaired by Jacques de Larosière will represent an important contribution to the policy discussions.

Considering the possible options and as underlined in particular by a number of Members of Parliament, Article 105(6) of the Treaty explicitly mentions the possibility for the Member States to decide to confer upon the ECB specific tasks in the domain of financial supervision. Reflections have started on the specific role that could be played by the ECB and its Governing Council should this provision of the Treaty be activated. At this stage the Governing Council has not yet taken a position on this topic. I will not fail to report to you the outcome of these reflections.

European Central Bank Directorate Communications Press and Information Division

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