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The crisis has shown that some kinds of growth are not in our interest. The crisis showed that growth fuelled by debt is artificial growth. It is simply not sustainable. When considering the calls for financing growth through debt, one must also remember that countries at risk of losing or having lost market access, or paying prohibitive costs for their sovereign funding because of excessive deficits and debt burdens, simply do not have the luxury to choose. Their only option is to restore sustainability to their public finances. If they don't, they will face rising borrowing costs with all their negative consequences for the real economy, for growth and employment and mainly for the most vulnerable in those societies, because as usual it will be the poorest that will pay the highest costs when there are high levels of debt...
When bankers make mistakes it should not be taxpayers who pay the bill. And what a bill it is. To date €1.6 trillion, which is almost 13 per cent of Europe's GDP, has already been used to support the banking sector. And I'm not including all the guarantees, so can anyone really believe that it will be easy to get out of the crisis when around 13 per cent of our GDP global in Europe has been used for the financial crisis? This is why we are breaking the link between bank losses and sovereign debt. The recapitalisation of banks by the ESM will be possible after the Single Supervisory Mechanism is in place, which should be in the second half of this year...
Our enhanced system of economic policy coordination at the European level, including the European Semester with its Country-Specific Recommendations as well as the six-pack legislation and shortly the so-called two-pack, has addressed central lessons learned from the crisis. This new institutional architecture does not mean that one and the same medicine is applied for all 17 Member States of the euro area or the 27 Member States in the European Union. On the contrary. The country specific recommendations reflect the diversity of the Member States, their starting positions, social models, traditions, risks and opportunities. Specific solutions are being applied on a case-by-case basis, demonstrating that Europe's ability to meet the competitive challenge increasingly depends on actions by Member States rather than regulation from Brussels.
Reforms in areas such as labour markets, pensions, public administration and education are mainly a national responsibility but will bring benefits across the Union and the euro area. An increased pooling of economic policy making becomes indispensable. The crisis has shown how dependent we are on the decisions (or non-decisions) of others. These affect us all both negatively and positively in the case of "good policies", especially in the context of a shared currency.
This requires stronger policy implementation at national level, in particular for euro area Member States and a better functioning of EMU as a consequence. This will contribute to a return of confidence and building a stronger base for sustaining European competitiveness, creating growth and avoiding the mistakes of the past. That promise must now be delivered through the full use and strict implementation of the new tools that are already in place.
A weakening in our resolve would be a betrayal of Europe's future and of the efforts which have been made across our Member States in the last few years, efforts and sacrifices being made by our citizens on a daily basis which are now beginning to bring results...
This brings me onto our future agenda; our "will do" mentality, which inspires the Commission's Blueprint for a deep and genuine Economic and Monetary Union.
To overcome the crisis in a sustainable way and to restore confidence, we need indeed to give tangible proof of the willingness and capacity of the Europeans to move forward – together - in a decisive way through the strengthening of the architecture in the financial, fiscal, economic and also political domains. That is our Blueprint's ultimate goal.
We have provided our vision and principles for the future - some concrete and short-term, others more ambitious and long-term to support the deepening of the Economic and Monetary Union. This is indispensable for those countries with a shared currency. It is critically important that as more integration happens we keep the integrity of the Single Market and the European Union as a whole.
The credibility of the institutional and political construction supporting the EMU is at the core of the confidence issue. Investors need to know our intentions. That is why we are going step by step to reinforce economic governance. In this process, seeing the next step is crucial. Banking union is at the forefront. With the agreement on the Single Supervisory Mechanism last December we have already achieved a lot. The next step is the Single Resolution Mechanism and the Commission intends to present a proposal before the summer.