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Close up of portuguese euro coin © Thinkstock.com Ongoing joint Commission/IMF/ECB review mission in Portugal to set up policy programme
- Review mission to Ireland finds programme is on track but challenges remain
- Joint IMF and European Commission mission to Latvia sees clear signs of recovery
- Commission and IMF mission in Hungary welcomes Hungarian structural reform plan
- G20 make good progress on framework for growth, reform of international monetary system
- Commission assessment finds raising sufficient climate financing “challenging but feasible”
- Conference facilitates stakeholder consultation on the Europe 2020 Project Bond Initiative
- ECB raises key interest rates by 25 basis points
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Close up of portuguese euro coin © Thinkstock.com Ongoing joint Commission/IMF/ECB review mission in Portugal to set up policy programme

After Portugal's formal request for financial assistance on 7 April, a joint mission of the European Commission (EC), the International Monetary Fund (IMF) and the European Central Bank (ECB) is currently in Lisbon. The mission's aim is to set up a policy programme with the Portuguese authorities by involving Portugal's main political parties. The programme will be supported by strict conditionality and be based on a cross-party agreement. Earlier, on 8 April in Gödölö, Hungary, based on a first examination by the Commission, EU finance ministers had agreed on the next steps to provide financial assistance to Portugal. In their statement, Ministers stressed that the cross-party agreement should ensure that an adjustment programme can be adopted by mid-May and implemented swiftly after the formation of a new government.

Viewpoint
"
The recovery of European economy has taken hold, but it is uneven and still threatened by volatility in the financial markets. While we are doing the necessary to safeguard financial stability, at the same time we need to press ahead with measures that foster growth, investment and the creation of jobs.

Olli Rehn, Commissioner for Economic and Monetary Affairs
"
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Review mission to Ireland finds programme is on track but challenges remain

Staff teams from the European Commission (EC), European Central Bank (ECB), and International Monetary Fund (IMF) visited Dublin during 5-15 April for the first quarterly review of the government’s economic programme. The objectives of the programme are to address financial sector weaknesses and to put Ireland’s economy on the path of sustainable growth, sound public finances, and job creation. Distributing the burden of adjustment fairly across society is one of the programme priorities. The teams’ assessment is that the programme is on track but challenges remain. Above all, continued strong programme implementation, with support from the EU and the IMF, remains key to achieving Ireland's return to capital markets at affordable interest rates.
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Joint IMF and European Commission mission to Latvia sees clear signs of recovery

During the joint mission, which took place from 5-15 April, staff discussed the fourth review of the ongoing financial support programme with the Latvian authorities and reached agreement at staff level on the main elements of the government’s policy programme. The mission concluded that the Latvian economy is now showing clear signs of recovery that reflect the Latvian authorities’ continued implementation of their economic programme. The Latvian government’s policy agenda for 2011 sets the stage for meeting the conditions for euro adoption in January 2014, and for sustaining the economic recovery. Deficit-reducing measures contained in Latvia's 2011 budget should ensure that Latvia is within reach of a general government deficit below 3 percent of GDP by 2012. Completion of this review by the IMF and EC will unlock around EUR 970 million in resources from the EU and the IMF, with another EUR 100 million expected to be approved by the World Bank. However, the Latvian authorities intend to draw funds only from the World Bank.
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Commission and IMF mission in Hungary welcomes Hungarian structural reform plan

European Commission officials, in close cooperation with International Monetary Fund staff, conducted a mission in Hungary from 4-8 April. The purpose of the mission was to prepare the Commission's spring 2011 forecast and to review recent developments and policy initiatives. The Commission and IMF were mandated to continue surveillance after the expiry of the EU balance of payments assistance to Hungary in November 2010. Commission and IMF officials welcomed the announcement by the Hungarian government of structural measures contained in the "Széll Kálmán plan". The measures include reforms to reduce social and pension expenditures, as well as cut costs in local government and the transport sector. They are expected to improve the sustainability of public finances. The Hungarian government will provide further details in the Convergence programme due to be submitted to the EU in mid April.
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G20 make good progress on framework for growth, reform of international monetary system

G20 Finance Ministers and Central Bank Governors met in Washington on 14-15 April. Good progress was made with a view toward the Cannes summit on 3-4 November. The key points of discussion were: (i) the global economy and G20 Framework for Growth. A key decision was taken on the benchmarks used to detect global imbalances; (ii) prioritising G20 work on the reform of the international monetary system, focusing on the management of global capital flows, the extension of the basket of currencies of the IMF’s Special Drawing Rights, and the need for good integration between regional financial safety nets and the IMF; (iii) financial regulation; and (iv) commodity price volatility.

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Climate Change © Thinkstock.com G20 leaders in Seoul 2010 © G20 Seoul Summit - All rights reserved
Commission assessment finds raising sufficient climate financing “challenging but feasible”

On 8 April, the European Commission published a Staff Working Document on financing for climate actions in developing countries. The report confirms that although raising USD 100 billion per year by 2020 will be challenging, it can be done. The authors of the report stress that the right balance needs to be struck between public funding, funding raised from international carbon markets, and private funds, partly leveraged by development banks. Climate funding will need to be closely linked with development aid and it will require strong international coordination to ensure that money is provided and spent efficiently. The Commission assessment confirms the conclusions of the report by the UN Secretary-General’s High-level Advisory Group on Climate Change Financing (AGF), which was presented in November 2010.
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Conference facilitates stakeholder consultation on the Europe 2020 Project Bond Initiative

A conference on the Europe 2020 Project Bond Initiative was held on 11 April in Brussels. The Conference served to facilitate the stakeholder consultation recently launched by the European Commission and the European Investment Bank (EIB). Implementation of the Europe 2020 Strategy for smart, sustainable and inclusive growth as well as completion of the internal market is expected to require record levels of investment over the next decade in Europe's transport, energy, information and communication networks. Preliminary estimates point to investment needs of EUR 1.5 to 2 trillion. This reality, combined with the fact that government budgets are under pressure, makes it crucial to foster the participation of the private sector in the financing of infrastructure projects. The principal idea behind the Europe 2020 Project Bond Initiative is to provide EU support to project companies issuing bonds to finance large-scale infrastructure projects.
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ECB raises key interest rates by 25 basis points

At their meeting on 7 April, the Governing Council of the ECB decided to raise key interest rates. With effect from 13 April, the interest rate on the main refinancing operations of the Eurosystem increased by 25 basis points or 0.25% to 1.25%, the interest rate on the marginal lending facility increased by 25 basis points to 2.00%, and the interest rate on the deposit facility increased by 25 basis points to 0.50%. The rate rise represents the first increase since the ECB reduced interest rates to 1% on its main financing operations on 7 May 2009. The reduction was to support economic recovery.
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Publications
European business cycle indicators

European business cycle indicators
This quarterly publication provides short-term analysis based on the joint harmonised EU programme of business and consumer surveys. The first issue of 2011 takes a closer look at the relationship between stocks and production expectations, suggesting that the crisis has been associated with a significant change in manufacturers’ inventory behaviour. Manufacturers have become risk averse to holding excessive stocks while stock management has become more responsive to fluctuations in economic activity.


Upcoming: Product market review
Upcoming: Labour market review 2010
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Agenda Calls
20 April
Frankfurt am Main
ECB Governing Council meeting
2 May
Brussels
Financial integration and stability. EC/ECB joint conference
5 May
Frankfurt am Main
ECB Governing Council meeting
13 May
European economic forecast, spring 2011
16-17 May
Brussels
Eurogroup/ECOFIN meetings
18 May
Brussels BEF 2011 – The Brussels Economic Forum 2011
20-21 May
Astana, Kazakhstan
EBRD Annual meeting and Business Forum
25-26 May
Paris
Road to recovery. OECD Forum
26-27 May
Deauville
G8 Summit
6-9 June
Strasbourg
European Parliament Plenary
14-15 June
Brussels
Eurogroup/ECOFIN meetings
22-23 June
Brussels
European Parliament Mini-plenary session
Invitation to tender ECFIN/A/2011/001 - Open Procedure. Data supply services: Bond and equity data - Establishment of a 4 years framework contract (deadline for submission: 12 May 2011)
Consultation on the Europe 2020 Project Bond Initiative (deadline for submission: 2 May 2011)
Internal Market. Public consultation "The EU corporate governance framework"(deadline 22 July)
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Directorate-General for Economic and Financial Affairs