At today’s meeting of the Economic and Financial Affairs Council, chaired by Minister of Finance, Andrej Šircelj, ministers discussed the future of economic governance, energy price trends and the package of legislative proposals for the implementation of international banking standards (Basel III).
The meeting started with a discussion of the package of legislative proposals for the implementation of international banking standards in the EU, the so-called Basel III. One new feature of the proposed rules is that they will require banks to identify, publish and manage climate, social and governance-related risks. The package will give supervisors more powers to verify the legitimacy of bank transactions and bank managers. Uniform rules are proposed for branches of banks from outside the EU. It is important that the changes brought about by the package will have a positive impact on the resilience of the EU banking system, while ensuring that banks continue to support the economy through funding.
At today’s ECOFIN Council meeting, the first exchange of views on the future of fiscal policy in the EU took place, following the publication by the European Commission in October of its communication on the EU economy after COVID-19: implications for economic governance. The current situation is different from that of February 2020, when the Commission first started the discussions, which should be duly taken into account. There is a need for further guidance in the light of the changed circumstances caused by the pandemic. The discussion showed an interest in further discussions, towards greater simplicity and transparency of fiscal rules and providing favourable conditions for further progress in the recovery.
Our efforts to promote recovery are paying off. The EU member states’ response to the crisis is producing good results. Now is the time to look ahead and start discussing the future of economic governance. Today we had an initial exchange of views on the future of the fiscal policy. We will continue our discussions to try to find common solutions.
Andrej ŠirceljMinister of finance
Andrej ŠirceljMinister of finance
The signs of recovery in the European Union are positive and the results of targeted action are visible. A total of 22 recovery plans have already been adopted and 17 of these Member States have already received the advance they can request. We are entering a new phase as we continue to implement reforms and investments. The European Commission expects to receive requests for the first disbursements soon. This means that member states are on track with the targets they have set in their plans. In the light of the recovery, ministers also discussed the NextGenerationEU instrument. For the first time, the European Commission is borrowing on the markets, which is a historic moment. It also issued green bonds worth EUR 12 billion, confirming the European Union's commitment to the green agenda.
Participants at the meeting also exchanged views on energy prices and the impact of price rises. They discussed the measures proposed by the European Commission to mitigate the impact of price rises. Some countries have already introduced measures such as tax cuts, social benefits and allowances, while others are still considering them. The measures are mainly targeted at vulnerable households and businesses to ease the immediate impact. Those present agreed with the European Central Bank that the price increases were temporary. However, the impact of changes in energy prices and the resulting inflation should be closely monitored. The debate showed support for green transition as an opportunity rather than an obstacle.
At today's meeting, ministers also endorsed conclusions on the future of the European Semester, focusing on the implementation of the Recovery and Resilience Facility, and conclusions on EU statistics.