23 April 2012

Speech by President Barroso: "The future of the EU – moving forward together"

Growth is the real long term challenge in a rapidly changing world. If Europe wants to prosper in the future and maintain our values, our social models, our quality environment, we need to invest now in the changes that will ensure what we call smart inclusive sustainable growth in the future. And we must do it together. Indeed, we can only succeed if we do it together – for obvious reasons: even the biggest of our Member States simply don't have the dimension to come to agreements on an equal footing with the biggest economic poles in the world: our American friends, China and others. How can a country with 60 million people, not to speak of countries that have less than 10 million people, think that they can discuss on an equal footing with countries with 1.2 or 1.4 billion people, in the future?

The world is changing completely. We are in the 21st century now. And dimension counts. And if we want to defend our values, our social market economy; if we want to defend, for instance, our policy on climate, we need the dimension of the European Union, or we simply will not have the leverage, we simply will not have the influence, and so Member States will face irrelevance if they don't commit to a stronger European Union.

I have spoken of the need for a united Europe and an open Europe. In the end it comes always to this. United Europe and open Europe. The current crisis has also shown that a common currency – the euro - requires further economic integration, greater coordination and discipline... Indeed – and this sometimes appears as a paradox since it goes against the prevailing mood – the Member States have agreed at unprecedented levels on coordination and discipline of those points that were simply not acceptable, I would say really unthinkable just five years ago.

I know because we have discussed this with them some time ago. We have discussed this. It was unthinkable. We could not do it. And now precisely because the Member States have the experience of this level of interdependence they are ready to accept what was simply not admissible some time ago. Because we are really united in our market and we really need this dimension.

The euro needs this. It is not just the federalists, it is the markets. Now the markets are asking us: "Are you ready to sustain your currency?" Not only: "What is the deficit in Greece?", but: "What is the political will of Germany?". This is the question they are asking because if you want to have a common currency we need to have some levels of integration.

That is why I insist that the euro is the currency of the European Union. We have two countries which have opted out and we respect them, Denmark and United Kingdom, but the euro is the currency of the EU and that is why we cannot make a division based on the euro. Because if we make a division based on the euro we will put at risk the internal market and the internal market is the basis, the necessary basis for growth and prosperity in Europe. That is why I want to state very clearly that we are against new divisions in the EU.

There are some mechanisms in the Treaties to reinforce cooperation: they are Treaty-based, they are the rules. But what we have to accept is that for obvious reasons, for reasons of common sense, we need more integration in governance in the euro area. But that should be compatible with keeping the level playing field of the of the EU, of the Single Market, of the so called four freedoms – in fact not only the four freedoms of capital, services, goods and people but also the fifth freedom, the freedom of knowledge. That is why we are so committed to the European research area. And that is exactly what we are now doing.

My answer is that the necessary strengthening of integration for the euro can and should happen in a way that respects the two principles of unity and openness. And decisions on issues like the single market or cohesion which will affect all Member States must involve all Member States.

We in the European Commission are charged with ensuring that the law, the equality of Member States, and the role of the EU institutions are respected. This was the European Commission's main objective in the discussions on the Treaty on Stability, Coordination and Governance, signed by 25 Member States in March, including Denmark, which I really welcome.

This Treaty represents the very culture of financial stability that is a prerequisite for true economic union, the necessary counterpoint to monetary union.

The European Commission would have preferred this to be an EU Treaty but there was not the necessary unanimity among Member States. But the new fiscal pact fully reflects the community method, respects the role of EU institutions and includes democratic safeguards. Its content will be rolled back into the EU Treaties within five years.

I want to underline this - the European Union is a Union of law. We are not just a Union of Member States, because in the past many European countries were engaged in international cooperation in Europe, and some of the countries were simply not democratic, they were simply not respecting the rule of law. In the European Free Trade Association (EFTA) agreement there were countries that were simply not democracies. You cannot stay in the European Union if you are not a democracy and our Union is based on the rule of law. That is why this is important, because this is the way to ensure fairness, to insure for instance that the big Member States do not take decisions alone and leave the other Member States, smaller or not so rich, in a detrimental position.

That is why I want to finish my point with this – we are a Union of values. Yes, it started with the common market. Yes, it started around the economic integration, but what we need now is to understand that the European Union was based with a political aim – namely the aim of peace after the two World Wars. To some extent they were in fact European civil wars. The goal is a political one, for a political future for Europe and we are based on values – the value of freedom and the value of solidarity. I think these values are something that we should stand for and have the courage to defend globally, while respecting the other partners, but being sure that we can defend our own values, what we usually call our social market economy, and we can do it in a much stronger and efficient way if we do it together.

Full speech

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