Establishment of a European monetary fund (EMF)

06-03-2019

The European Commission's proposal for transforming the intergovernmental European Stability Mechanism (ESM) into a European monetary fund (EMF) under EU law would provide it with wide-ranging tasks. The ESM was created at the height of the European sovereign debt crisis in order to provide financial assistance for governments that had lost, or were about to lose, access to financial markets. It was established outside the Community framework by an intergovernmental treaty and is a permanent rescue mechanism aimed at safeguarding the financial stability of the euro area. The proposal met with considerable opposition at Council level, as the Council wishes to maintain the ESM's intergovernmental character, and would expand its remit only slightly. The European Parliament, whose legislative powers are limited within the consent procedure, will vote on an interim report in plenary.

The European Commission's proposal for transforming the intergovernmental European Stability Mechanism (ESM) into a European monetary fund (EMF) under EU law would provide it with wide-ranging tasks. The ESM was created at the height of the European sovereign debt crisis in order to provide financial assistance for governments that had lost, or were about to lose, access to financial markets. It was established outside the Community framework by an intergovernmental treaty and is a permanent rescue mechanism aimed at safeguarding the financial stability of the euro area. The proposal met with considerable opposition at Council level, as the Council wishes to maintain the ESM's intergovernmental character, and would expand its remit only slightly. The European Parliament, whose legislative powers are limited within the consent procedure, will vote on an interim report in plenary.