The Eurogroup has consistently emphasised that our fiscal strategy should be agile and responsive to unfolding events. This approach remains all the more relevant as heightened uncertainty needs sufficient flexibility.
... It's now very clear that
the economic toll of this war is worldwide. High prices and disruption
to food supplies are crippling across the world with very serious
consequences for the most vulnerable in our societies. And of course,
the euro area is facing these challenges, too.
However, we do
have the resilience to face this new shock with savings that were built
up during the pandemic. Healthy balance sheets in the financial sector
and the flexibility and agility of our economy can and will see us
through this challenge.
There will be
an impact on growth in the short term and the high price of energy and
other commodities on world markets which does mean that, as a continent,
our purchasing power has suffered. Our discussion today showed that
many member states are indeed cushioning the blow for their citizens,
especially for the most vulnerable households.
The Commission
presented to the Eurogroup the package it issued today and the European
Central Bank outlined how it is responding to higher inflation.
That's why the
Commission's announcement on keeping the general escape clause
activated for another year is an important development. At the same
time, this decision doesn't change our objective of progressively
shifting our fiscal stance from supportive this year to neutral next
year. There is broad agreement amongst ministers that we need to strive
to continue to make our budgetary policies and decisions as sustainable
as possible in this uncertain environment. So we will be following up on
the discussion today in more depth in the next couple of months. The
policy trade-offs are very complex and we will take the time necessary
to get the policy balance right. We will aim to adopt a statement on the
budgetary stance for next year at our July Eurogroup meeting.
On the subject
of fiscal policy, we discussed the updated draft budget plans of
Portugal and Germany. We welcomed the Commission opinions on them and we
share the Commission's positive assessment. As usual, we have adopted a
short Eurogroup statement reflecting our views.
We also today
discussed the candidacies for the upcoming vacancy of the Managing
Director of the European Stability Mechanism. The purpose of having this
discussion within the Eurogroup was to assess the level of support that
candidates receive and to play a role in facilitating the actual
appointment which will take place at the ESM Board of Governors.
Following a
brief presentation by my colleagues from Italy, Luxembourg, the
Netherlands and Portugal of their nominees, we then held an indicative
vote. The Netherlands have decided to withdraw their candidacy. That
means we now have three candidates in this contest: Marco Buti, Pierre
Gramegna and João Leão. We will continue further informal consultations
with a view to add to reaching an agreement at the ESM Board of
Governors meeting on the 16th of June.
Today, we
continued our discussion in inclusive format on the draft work plan to
complete the Banking Union, building on the special meeting we had
earlier this month and much work in in the high level working group. We
had a full discussion on my proposal for a stepwise and time bound work
plan. The meeting we had this evening fully met my expectations
regarding our discussion.
What is on the
table is very finely balanced, based on four policy areas, two phases
and a political checkpoint. I have to acknowledge that differences of
views remain. This is what I would expect at this point in the process.
Nonetheless,
reaching agreement would be beneficial. It would send a sense of
commitment on an important point and indicate that we've aimed and have
been successful in reaching a fair balance for all parties. We will work
hard in the time ahead to set the path for the future of this vital and
common project.
I will
re-engage on this again in June to find an agreement. I continue to
reflect on all the arguments that I heard today on Banking Union, and
I'll engage with all ministers and do my very best to help reach a
balanced compromise.
Eurogroup
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