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Timeline: The Evolution of EU Economic Governance in Historical Context

Economic governance in the EU has been reinforced and refined over time, evolving in the context of historical developments. This timeline includes links to legislation and background information.

Development in Economic GovernanceHistorical context

2016

March

2015

October

EMU

October The Commission adopts a package of measures to begin implementing the Five Presidents’ Report. It entails a revised approach to the European Semester, the introduction of national Competitiveness Boards and an advisory European Fiscal Board; a more unified representation of the euro area in international financial institutions, especially the IMF; and steps to complete the Banking Union, notably via a European Deposit Insurance Guarantee Scheme.

- The 10 Priorities of the Commission: A Deeper and Fairer EMU

June

EMU

June The Five Presidents’ Report “Completing Europe's Economic and Monetary Union”pdf Choose translations of the previous link  sets out ambitious plans on how to deepen the Economic and Monetary Union in three stages and to complete it by 2025 at the latest. It proposes to complete four Unions, an Economic, Financial, Fiscal, and Political Union.

- Five Presidents' Report sets out plan for strengthening Europe's Economic and Monetary Union as of 1 July 2015
- Completing Europe's Economic and Monetary Union – College of Commissioners discusses first steps

August

Financial Assistance

August Memorandum of Understanding (MoU) of new three-year stability support programme for Greece signed, during which the ESM may disburse up to €86bn. This is complemented by a Jobs and Growth Plan for Greece worth €35bn until 2020.

- Commission signs three-year ESM stability support programme for Greece
- A new start for jobs and growth in Greece: Commission mobilises more than €35 billion from the EU budget

January

Flexibility

January The Commission issues guidance on how it will apply the SGP rules to strengthen the link between structural reforms, investment and fiscal responsibility in support of jobs and growth.

Euro adoption

January Lithuania adopts the euro.

2014

November

Review

November A review of the Six-Pack and Two-Pack rules calls for improved transparency and simplicity.

June

Financial assistance

JunePortugal's financial assistance programme concludes.

January

Financial assistance

JanuarySpain's financial assistance programme concludes.

Euro adoption

JanuaryLatvia adopts the euro.

2013

December

Financial assistance

DecemberIreland's financial assistance programme concludes.

July

EU enlargement

July Croatia joins the EU.

March

Financial Assistance

March The EU and IMF lend €10 bn to crisis-hit Cyprus in return for a programme of reforms.

February

‘The two-pack’ is passed.

February EU lawmakers approve legislation in which euro area Member States agree to prepare their budgets according to common standards and a common timeline, submitting drafts to the Commission and each other.
The two pack entered into force in May 2013.

2012

December

EMU

December The Four Presidents’ Report "Towards a Genuine Economic and Monetary Union" provides a roadmap for the completion of the Economic and Monetary Union. It focuses on completing, strengthening and implementing the enhanced economic governance, as well as on establishing a Banking Union for the euro area by adopting the Single Supervisory Mechanism, as well as new rules on bank recovery and resolution, and on deposit guarantees.

- TOWARDS A GENUINE ECONOMIC AND MONETARY UNIONpdf
- A Blueprint for a deep and genuine Economic and Monetary Union: Launching a European debate - A Blueprint for a deep and genuine Economic and Monetary Union (EMU): Frequently Asked Questions

October

European Stability Mechanism

October The European Stability Mechanism (ESM) becomes operational.

September

Outright Monetary Transactions

September The European Central Bank (ECB) quashes speculation about the future of the euro by announcing its Outright Monetary Transactions bond-buying programme.

July

ECB President Draghi

July ECB President Draghi pledges ‘to do whatever it takes to preserve the euro.’

Financial Assistance

July The EU and IMF pledge €100 bn to crisis-hit Spain in return for a programme of banking reforms.

March

The Fiscal Compact is passed

March Euro area Member States agree to make the goal of balanced budgets part of their national constitutions and future euro area members agree to do so once they adopt the common currency. The fiscal compact is part of a treaty known as the Treaty on Stability, Coordination and Governance, which entered into force in January 2013.

The TSCG also introduced Euro Summits, i.e. meetings of euro area leaders which take place at least twice a year.

Financial Assistance

MarchThe EFSF and IMF lend Greece €130 bn following a successful restructuring of Greece’s sovereign bonds with private creditors.

2011

September

EMU

September With the future of the euro area in question, the monitoring, coordination and enforcement of economic governance moves up a gear. A collection of six new laws, known as the ‘six-pack’ is agreed by EU lawmakers in September 2011.

September Macroeconomic imbalances in one country that could spillover and threaten others come under scrutiny and the Macroeconomic Imbalances Procedure is born. The Stability and Growth Pact becomes more comprehensive and easier to enforce. The Six-Pack entered into force in December 2011.

May

Financial Assistance

May The EU and IMF lend €78 billion to crisis-hit Portugal in return for a reform programme.

January

2010

November

Kick-off first ‘European Semester’

November The monitoring and coordination of fiscal and economic policies and the Commission’s policy recommendations are integrated and organised.

Financial Assistance

November The EU and IMF lend €85 bn to crisis-hit Ireland in return for a reform programme.

European Stability Mechanism

November European governments decide to create the European Stability Mechanism (ESM), a permanent financial assistance fund.

June

European Financial Stability Facility

June The euro area's first financial assistance fund, the temporary European Financial Stability Facility (EFSF) is created.

May

Financial Assistance

May Euro area countries lend €110 bn to help crisis-hit Greece in return for a reform programme.

2009

December

Treaty of Lisbon

DecemberTreaty of Lisbon goes into force.

January

Euro adoption

JanuarySlovakia adopts the euro.

2008

September

Crisis

September Lehman Brothers files for bankruptcy.

January

Euro adoption

JanuaryCyprus and Malta adopt the euro.

2007

December

Treaty of Lisbon

December EU Member States sign the Treaty of Lisbon.

January

Crisis

January Start of the US subprime mortgage crisis.

EU enlargement

January Bulgaria and Romania join the EU.

Euro adoption

JanuarySlovenia adopts the euro.

2005

‘End of the one-size-fits all era’

EU lawmakers amend the ‘Stability and Growth Pact’ enabling it to better consider individual national circumstances.

  • Surveillance and coordination are strenghtened.
  • The excessive deficit is clarified and made faster.

2004

ECJ rules on the Stability and Growth Pact

The European Court of Justice overturns the Council’s rejection of the Commission’s recommendations citing procedural issues but rules that responsibility for enforcing the Stability and Growth Pact lies with the Council.

EU enlargement

10 new members join the EU: Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovakia and Slovenia.

2003

‘Commission and Council go to court.’

EU finance ministers reject the European Commission’s recommendation to initiate sanctions proceedings against France and Germany for flouting the Stability and Growth Pact’s rules. The Commission takes the Council to the European Court of Justice.

2002

The euro

Euro notes and coins are introduced.

2001

Euro adoption

Greece adopts the euro

1999

January

Euro adoption

January The euro is introduced as an accounting currency and adopted by Belgium, Germany, Ireland, Spain, France, Italy, Luxembourg, the Netherlands, Austria, Portugal and Finland.

Stability and Growth Pact

January Entry into force of SGP corrective arm.

1998

July

Stability and Growth Pact

July Entry into force of the SGP preventive arm.

1997

The ‘Stability and Growth Pact’ is born

EU Member States agree to strengthen the surveillance and coordination of national fiscal and economic policies to enforce the Maastricht rules.

Euro area exchange rate

Euro area countries fix their exchange rates.

1995

July

EU enlargement

July Austria, Finland and Sweden join the EU.

1992

September

'Black Wednesday'

September The British pound and the Italian lira are withdrawn from the European Exchange Rate Mechanism.

February

EU Member States sign the Treaty of Maastricht

February The Treaty of Maastricht introduces the euro as a common currency and limits government deficits and public debt levels to 3% and 60% of GDP respectively.