European Council of Brussels: joint press conference by José Manuel Barroso and Herman van Rompuy
Type: Complete press conference
End production: 14/12/2012 First transmission: 14/12/2012
On 14 December 2012, José Manuel Barroso, President of the EC, and Herman van Rompuy, President of the European Council, gave a press conference following the first evening of the European Council, held on 13-14 December 2012 in Brussels.
On this occasion, they underlined the good discussion on the future of the Economic and Monetary Union. José Manuel Barroso also welcomed the endorsement of agreements on the Single Supervisory Mechanism and on Greece.
Only the original language version is authentic and it prevails in the event of its differing from the translated versions.
||Arrival of José Manuel Barroso, President of the EC, and Herman van Rompuy, President of the European Council, to the press conference at the European Council in Brussels
||José Manuel Barroso and Herman van Rompuy heading to the podium and being introduced by the moderator (2 shots)
||Soundbite by Herman van Rompuy (in ENGLISH): Thank you. Good night. This is a good week for the European Union, a week to be remembered. On Monday we were in Oslo. This morning the Finance Ministers agreed on a Single Supervisory Mechanism for banks, and a decision was taken on Greece in the Eurogroup.
And tonight, we had a very constructive first evening of this European Council. We took decisions on the way forward for the eurozone, focusing on two areas.
First, strengthening our banking system.
Here the progress achieved this morning with the establishment of the SSM marks a breakthrough. It will strengthen our financial sector. Breaking the vicious circle between sovereigns and banks will help ensure stability and improve lending conditions – both vital for growth and employment in the eurozone and beyond.
We achieved this in the space of just a few months. Back in June, there was nothing. Then the European Council set out the course; right after the summer the Commission had proposals ready; and within three months the finance ministers reached an agreement, while the Parliament has already adopted its position on this question at committee level. Back in June we asked for the SSM to be ready in December, and we delivered. This clearly shows the Union's ability to take timely and decisive action; it is our way, our European way of working.
The agreement on the SSM strikes a good balance. It serves the need of eurozone members, whilst being open to all and taking into account those that choose not to take part. It is a truly single system, with a sensible division of labour between the ECB and national authorities.
Regarding the ECB, it ensures a clear separation between monetary policy and supervisory tasks. And finally, it preserves the integrity of the single market for financial services. But we do not stop here; we are already looking at the next steps: it's essential for the eurozone's future.
We agreed to establish in the first half of next year an operational framework, including the definition of legacy assets, so that when the SSM is established, the European Stability Mechanism will have the possibility to recapitalise banks directly, following a regular decision.
For the SSM to be more effective, we decided tonight that, when the SSM is in place, "a single resolution mechanism will be required, with the necessary powers to ensure that any bank in participating Member States can be resolved with the appropriate tools". In the course of 2013, the Commission will submit a proposal, which should be examined as a matter of priority, with the intention of adopting it in the current parliamentary cycle. The objective is to reduce risks for taxpayers and for the economy, by making sure that any bank failures are dealt with in a swift and orderly way and in the best interest of all.
This brings me, after the progress on the banking union, to the second area on which we focused tonight: bringing our economic policies closer. The starting point is simple: for countries that share a common currency, economic policies are a matter of common interest.
As President of the European Council, I will present possible measures and a time-bound road map on four issues to the June 2013 European Council, in close cooperation with the President of the Commission, and after a process of consultations with the Member States.
These four issues are: the coordination of major economic reforms in the Member States, including through ex ante discussions, the social dimension of the EMU, the feasibility and modalities of mutually-agreed contracts for competitiveness and growth between governments and EU institutions, and finally, solidarity mechanisms that can enhance the efforts made by the Member States that enter into such contractual arrangements.
All this is not an end in itself: our overarching aim is a stable EMU, in order to improve growth, competitiveness and employment across Europe.
Looking at the wider situation, even if the worst of the eurozone crisis is behind us, much still needs to be done. But all the hard work is starting to pay off.
In conclusion, a lot has been achieved over the course of a year. Exactly twelve months ago the six-pack entered into force. This year, we agreed the Fiscal Compact, we launched the European Stability Mechanism and the ECB for its part also contributed to taming the crisis.
This morning, as I said, there was the agreement on the single supervisory mechanism, and this evening we decided to put in place a single resolution mechanism.
Since May, we are engaged in a process to address the systemic flaws in the EMU's architecture. Here the reports I presented together with the Presidents of the Commission, ECB and Eurogroup between June and December helped map the way forward. And this work is not over: the dynamic will carry on in the coming year, as we decided tonight.
Finally, let me say a few words on the decision reached this morning on Greece. It marks an important step. The decision will help ensure Greek debt sustainability over the medium term, and allows for supporting Greece in its adjustment efforts. This is strong sign of European solidarity to the people of Greece and a demonstration that the country and its European partners continue to live up to their commitments. It proves the irreversibility of the euro and the eurozone.
||Soundbite by the moderator (in ENGLISH) thanking Herman van Rompuy and inviting José manuel Barroso to take the floor
||Soundbite by José Manuel Barroso (in ENGLISH): Tonight we discussed how to complete the Economic and Monetary Union (EMU), how to have a full genuine EMU. There was, at the level of the European Council, an agreement on the roadmap for that purpose.
This discussion comes following a very important decision taken this morning by the Finance Ministers on the Single Supervisory Mechanism (SSM). The Commission presented a proposal on 12 September and almost exactly three months later, on the 13 December, there was a unanimous agreement by the Council on that proposal. As you know, when the Commission put forward this proposal, we said this is the first indispensable building block of the banking union.
So the agreement on the SSM is extremely important because it shows the EU and the euro area means business. It also shows that we can move forward at 27 within the Treaty framework. The proposal, now adopted, on the SSM is designed to meet euro area need but in a way that is open to all and this is critically important for all the exercise in which we are engaged. – how to deepen the EMU while keeping the integrity of the European Union as a whole.
The SSM is the key to all further steps in the construction of the Banking Union. We will not tolerate poor supervision for any of the 6000 banks in the euro area. There is now the possibility for ECB to step in and directly supervise any of them so that banks in difficulty are restructured or closed.
The first piece of banking union is agreed subject to the formal approval of the European Parliament. The next steps should be a swift conclusion on the bank capital rules and the harmonisation of national bank resolution and deposit guarantee schemes in early 2013. As you know the Commission has already tabled some months ago proposals precisely on that, so we expect now the co-legislator to agree on this as soon as possible. And today we saw the Heads of State or Government welcoming the prospects of a single resolution mechanism. Indeed the Commission will make a proposal for a single resolution mechanism in 2013. This will be the next important building block of our Banking Union. This will mean that taxpayers will not have to pick up the bill in the future and that the sector will pay to solve its own problems.
In the same vein, we need to get agreement quickly on the two-pack economic governance proposals. Everyone agrees at European Council level on the need for these proposals. I call now on the European Parliament to come to an agreement so that we can get these proposals adopted and take another important step on our way towards a deeper and more integrated Economic and Monetary Union.
Tonight we also had a good discussion on the future of the EMU. While our focus is on the immediate steps needed – we need a vision of where we are going. From that point of view, I found today’s discussion quite interesting. The report of the four Presidents, the report prepared by President van Rompuy together with myself and Presidents Draghi and Juncker, and also the Commission blueprint set out that vision – the vision for the medium and long term. I think it is an ambitious but realistic vision and the Commission is determined to keep up the pace of reform. But we also agree that national ownership and also the understanding of the next steps is needed and that was one of the most important purposes of tonight’s discussion.
So we have the input of Heads of State of Government on how they see now the next steps and I very much welcome the debate. Decisions were not expected for today, but the deepening of the process that is now launched. In fact, Heads of State or Government asked the President of the European Council in cooperation with the President of the European Commission to come with more concrete ideas and a time-bound roadmap at the June European Council. This discussion will enrich the work that the Commission is doing on more detailed proposals on many of these issues and which we will bring forward more formally next year.
For example, and that was a very important point in the discussion tonight, we will propose contractual arrangements namely for structural reforms, backed up by financial support. The fact that there was a general consensus on that is a very important development. Of course, now we have to put forward the detailed proposals.
To conclude, this year has been extremely tough, especially for the most vulnerable in our societies.
But in fact we are tackling the root causes of the trouble: Public finances are getting better. Competitiveness of the least competitive is improving. Financial sector is being cleaned up. Governance architecture is making progress. So while not complacent, there are reasons to be positive and I think that investors and our partners are recognising that. The fact that there was an important agreement on Greece was also extremely important because once again we have shown that we have the capacity to act and we are able to do whatever is necessary for a firm and sustained irreversibility of the euro as a currency of the European Union.
I thank you for your attention.
||Soundbite by the moderator (in ENGLISH) thanking José Manuel Barroso and opening the questions/answers session
||Questions/answers session with José Manuel Barroso and Herman van Rompuy