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Thursday, 12 May 2011 - StrasbourgOJ edition
ANNEX (Written answers) - QUESTIONS TO THE COUNCIL(The Presidency-in-Office of the Council of the European Union bears sole responsibility for these answers)

Question no 14 by Pat the Cope Gallagher (H-000189/11 )  
 Subject: The Eurozone crisis

Can the Council make a comprehensive statement on the discussions which took place at the informal meeting of Finance Ministers on 7-9 April 2011 in Budapest?


The present answer, which has been drawn up by the Presidency and is not binding on either the Council or its members as such, was not presented orally at Question Time to the Council during the May 2011 part-session of the European Parliament in Strasbourg.

(EN) Discussions at the informal meeting of Finance Ministers focused inter alia on the recent economic and financial stability developments in the euro area, the preparation of the G20 Ministerial meeting in Washington DC, developments in commodity markets, the new European Supervisory Architecture, stress tests.

Ministers and Central Bank Governors touched upon the issue of commodity markets and related financial derivative markets. There was agreement that increasing the transparency and integrity of both the physical and the derivatives markets are fundamental to ensuring that these fulfil their roles properly. Ministers and Governors had an exchange of views with invited guest speakers, Prof. Alexandre Lamfalussy, Mr. Jacques de Larosière, Ms. Sharon Bowles and the leaders of the new authorities on how the new European Supervisory Authorities and the ESRB may help to tackle the challenges we face today in the financial sector and on their vision for the new institutions. They also discussed issues related to this year's stress test exercise in the banking and insurance sectors, where emphasis was put on the need for transparency, credibility and need for governments to have well developed policy responses to stress scenarios.

Statement by the Eurogroup and ECOFIN Ministers acknowledged the Portuguese authorities' request for financial assistance. Ministers invited the Commission, the ECB, the IMF and Portugal to set up a programme and take appropriate action to safeguard financial stability. In the context of a joint EU/IMF programme, the financial assistance package to Portugal should be financed on the European side within the framework provided by the European financial stabilisation mechanism (EFSM) and the European financial stability facility (EFSF). The preparations by Portugal will start immediately to reach a cross-party agreement ensuring that an adjustment programme can be adopted by mid-May and implemented swiftly after the formation of a new government. The programme will be based on three pillars:

An ambitious fiscal adjustment to restore fiscal sustainability.

Growth and competitiveness enhancing reforms including an ambitious privatisation programme.

Measures to maintain the liquidity and solvency of the financial sector.

After an agreement has been reached with the Portuguese authorities and supported by the main political parties, the programme will be endorsed by the ECOFIN Council and the Eurogroup, in line with national procedures, on the basis of a Commission and ECB assessment.

At the Washington meeting, which was held from 14 to 15 April 2011, discussions were substantive and all major players showed genuine willingness to move the international economic agenda forward.

The most relevant deliverable was probably the agreement reached on the indicative guidelines, against which the indicators to detect those persistently large imbalances requiring policy adjustments from G20 members will now be measured.

This should not be regarded as a small outcome: behind this apparently technical agreement, there is a serious commitment by all major economies – both advanced and emerging – to bring forward a process of mutual assessment/peer review of the respective policies affecting global growth.

On the basis of the agreement reached on the indicative guidelines, the G20 should be able to deliver concrete results by the end of the year, namely a comprehensive action plan with country specific recommendations.

The Commission, the ECB and the Council Presidency are providing a very substantive contribution to the overall exercise, not least because the new governance system at international level presents in many respects similar features to those at the EU level.

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