Extracts from the press conference by Olli Rehn, on the EC's Communication on the progress in the correction of macroeconomic imbalances

Type: Summary of press conference   Reference: I-086881   Duration: 10:04:45  Lieu:
End production: 05/03/2014   First transmission: 05/03/2014
On 5 March 2014, Olli Rehn, Vice-President of the EC in charge of Economic and Monetary Affairs and the Euro, gave a press conference on the Winter economic governance package. The EC published on the same day its conclusions emerging from the in-depth reviews (IDRs) carried out into 17 Member States' economies. In the same document, the Commission assessed progress in the correction of fiscal deficits in the Member States concerned, updating its opinions on Draft Budgetary Plans from 2013.

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10:00:00 Title 00:00:05
10:00:05 Exterior view of the Berlaymont building in Brussels 00:00:07
10:00:12 Arrival of Olli Rehn, Vice-President of the EC in charge of Economic and Monetary Affairs and the Euro, at the press conference 00:00:07
10:00:19 Soundbite by Olli Rehn (in ENGLISH): The European economy will grow at 1.5% this year and 2% next year. The recovery is gaining ground and is becoming increasingly broad-based across Member States and more anchored on domestic demand. At the same time, challenges remain. Even though risks to the forecast have become more balanced, the largest downside risk is complacency. 00:00:38
10:00:58 Cutaway of press 00:00:04
10:01:02 Soundbite by Olli Rehn (in ENGLISH): In Italy, the persistent high public debt puts a heavy burden on the economy and is also a serious concern for negative spillovers to the rest of the euro area. Italy will need to maintain high primary surpluses for many years, as well as lifting its growth rate, to reverse this trend. There is a risk that the adjustment of the structural balance in 2014 is insufficient given the need to reduce the very large public debt ratio at an adequate pace. 00:00:40
10:01:43 Cutaway of a cameraman 00:00:04
10:01:48 Soundbite by Olli Rehn (in ENGLISH): Concerning France, decisive policy action is required in order to fight the country's imbalances. The growing trade deficit reflects the long-term fall in export market shares. Despite measures taken to foster competitiveness, so far there is limited evidence of rebalancing. While wages have developed in line with productivity recently, the labour cost remains high and weighs on firms' profit margins and weakens capacity to invest. 00:00:43
10:02:31 Cutaway of the audience 00:00:04
10:02:35 Soundbite by Olli Rehn (in ENGLISH): In Germany, the persistently high current account surplus is a sign of strong external economic competitiveness, which is positive but also implies that a large share of Germany's income is being invested abroad. In turn, domestically, both private and public investment has been low for a long time. This poses a risk to the economy's long-term growth potential. 00:00:37
10:03:12 Cutaway of the audience 00:00:04
10:03:17 Soundbite by Olli Rehn (in ENGLISH): Spain has taken strong policy action over the last year. This has supported a return of confidence and adjustment away from excessive imbalances. Spain has returned to growth, but key challenges remain, notably the very high level of unemployment and the still large stock of debt. 00:00:25
10:03:42 Cutaway of press 00:00:05
10:03:47 Soundbite by Olli Rehn (in ENGLISH): In Slovenia, while decisive progress in repairing the banking sector has been made, other challenges still require strong policy action. We also draw Slovenia's close attention to the risk of not complying with the budgetary targets. 00:00:20
10:04:07 Cutaway of the audience 00:00:04
10:04:12 Soundbite by Olli Rehn (in ENGLISH): Croatia is now experiencing a prolonged bust, in which a range of external and internal risks have come to the fore. State-owned enterprises, which in some sectors still play a dominant role and which are often un-restructured, are overall highly indebted and weakly profitable. 00:00:27
10:04:40 Cutaway of the audience 00:00:04
10:04:45 Soundbite by Olli Rehn (in ENGLISH): The Commission intends to carry out more detailed monitoring of the economic policies recommended by the Council to the Member States with excessive imbalances (i.e. Croatia, Italy and Slovenia), as well as for countries where imbalances require decisive policy action (i.e. Ireland, Spain and France). 00:00:31
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