Remarks
by J. Dijsselbloem following the Eurogroup meeting of 22 April
2016
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Good
afternoon. Welcome everyone, welcome to Amsterdam. Let me debrief you on the
Eurogroup meeting. Many of us were already in Washington at the IMF spring
meetings, discussing the state of play in the global economy, rising risks on
the basis of the advice and analysis of the IMF. The good news, however, for
major economies, this also goes for the Eurozone economy, is that our economies
have weathered global events quite well. I believe we are still on the right
track with economic growth that is broad-based, stronger supervision of banks
and signs that investment is starting to pick up throughout the Eurozone.
Greece
Having
said that, and on that positive note, let's first turn to Greece, which took up
a major part of our time today. We discussed the state of play of the first
review of the ESM programme and next steps to be taken.
Cooperation
between the institutions and the Greek authorities has been strong and
productive, but the institutions will say more about that. We believe that
substantial progress has been made, reducing the number of open issues, and
getting close to an agreement on a number of key areas such as pension reform,
income tax reform, the NPL strategy and the establishment of the privatisation
fund. On some issues more work will have to be done to fully conclude that, but
we are very close.
Today
we also looked at and clarified the way to go forward to bridge the issue which
is about insecurity of a forecast and confidence that we can have in the
implementation of what has been agreed.
We
came to the conclusion that the policy package should include a contingent
package of additional measures that would be implemented only if necessary to
reach the primary surplus target for 2018. The contingency mechanism needs to be
credible, legislated upfront, automatic and be based on objective factors which
would trigger these contingent measures.
That
needs further work: the design of that, how it would work, what kind of measures
there would be and what would trigger it. I'm happy to say that with the
commitment of the Greek minister to work on that constructively and as quickly
as possible, the institutions have said that they stand ready to work as quickly
as possible, in the coming days, on this contingency mechanism. On that basis,
if we have the package which needs to be done and delivered upfront, and if we
have the contingency package and the mechanism to support that, we can have a
further Eurogroup next Thursday. This is not for sure yet, but we are aiming for
a meeting next Thursday which would then come to positive conclusions on those
two elements, on the upfront package and the contingency package, and have a
serious discussion on debt sustainability. As you know we have a long standing
promise which was reaffirmed during the summer agreement, that if necessary and
on condition that the Greek government fully delivers on what has been agreed in
the programme, if necessary, we stand ready to consider more measures to assure
debt sustainability.
Ministers
today have given us a mandate to work on that, to make the analysis, and to
prepare possibilities within, of course, some limitations. To mention two main
ones: there is no support in the Eurogroup for nominal haircuts on the debt, and
what we will design and propose needs to stay within the agreement of last
summer. So we will look at possibilities of re-profiling and if necessary
possible additional measures, looking at maturities and grace periods as
outlined in the agreement last summer. And hopefully we will meet again next
Thursday to bring those elements all together and come to a political agreement
which would be very important for Greece and for the Eurozone.
Insolvency frameworks
Secondly,
let me go on in our agenda. Second item was work we are doing on insolvency
frameworks. This is very important for strengthening our economies, dealing with
our banks, and opening space for new investments throughout the Eurozone. It is
of course also an issue for the EU 28, so the follow up that we will give on the
issue will also be on the agenda in Ecofin for some months. We have asked the
Commission to do further work on that, to improve the quality of the data that
we have and to develop an approach aimed at improving the effectiveness of
national frameworks, trying to reach convergence at a higher level, in speed,
affordability and predictability of insolvency procedures.
So
on work that has been done so far, the Commission will do more on improving the
quality of data, and developing a method of benchmarking on insolvency
frameworks.
SSM
Finally,
on the SSM. We welcomed Danièle Nouy, the chair of the Single Supervisory
Mechanism to the Eurogroup. She regularly joins the Eurogroup to present to us
the state of play in the SSM. Today she presented the annual report. She
informed us about the execution of the supervisory tasks of the SSM. She spoke
specifically on the many options and national discretions that are still in our
banks and in our bank legislation and regulations. She is making a lot of
progress from the SSM. Work also needs to be done by legislators. The Commission
will work on that and put forward proposals to improve our level playing field
for our banking union.
Those
were the key issues.
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