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European Parliament closes ranks in support of closer economic governance


16 Jun 2010


Euro & Finance

Parliament is due to adopt today two important resolutions agreed upon by the four largest political groupings expressing a clear and strong message to the Heads of Government who meet in Brussels tomorrow for a summit to finalise plans for responding to the economic crisis and restoring growth.

"For the past few months, Parliament and Council have been holding a dialogue of the deaf," said Guy Verhofstadt, leader of the Liberals and Democrats in the European Parliament. "The open method of coordination didn't work for the Lisbon Strategy of the last 10 years and won't work for the EU 2020 strategy of the next 10 years. Frankly, I expected the European Council to come up with something more original and bold for once instead of the same old rhetoric of good intention but no determination."

Lena Ek (Sweden, Centre Party), ALDE spokesperson on the 2020 strategy and chief negotiator on the two resolutions also highlighted the lack of ambition being shown by the Council:

"This is the first time the European Parliament's main political groups have put ideological differences to one side and focussed on the core responses to the current crisis facing the European economy. Our economic rules need tightening, our governance structures need strengthening and our budget planning needs restructuring. "

The resolutions approved by Parliament this week make five clear points:

• The current crisis has shown up the weaknesses of the Stability and Growth Pact which now needs reinforcing with realistic sanctions for persistent non-compliance and some form of pre-screening of national budget planning and statistical data.

• Europe as a whole, but especially the eurozone needs more joined up economic governance, coordinated and led by the European Commission as a purely intergovernmental approach is bound to end in failure.

• The EU needs a strategy aimed at accelerating economic growth and based on a re-launch of the Single Market and a crack down on tax evasion, corruption and the black economy. More innovative ways of raising capital such as eurobonds also need to be envisaged to finance essential infrastructure.

• The Union must better prepare for future financial crises by developing the temporary financial mechanism into a European Monetary Fund.

• The new growth strategy for 2020 must have more ambition and more incentives to deliver the desired results - a combination of carrots and sticks for agreed flagship policies backed by budgetary commitments to match.

For more information, please contact:

Neil Corlett: +33-3-88 17 41 67 or +32-478-78 22 84




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