On 21 May 2019, Riga Graduate School of Law hosted a debate with European Commission Vice-President Valdis Dombrovskis on the topic “Deepening Europe’s Economic and Monetary Union”. The Dialogue took place in the context of Latvia’s celebration of 5 years since its accession to the Eurozone and 15 years since the largest EU enlargement in its history, when Latvia joined the Union.
After a presentation on the deepening of the Economic and Monetary Union (EMU) by Vice-President Dombrovskis, the debate turned to the recent financial crisis, with one participant wanting to know if the lack of oversight of the financial sector was one of the reasons for the crisis and how is it going to work now.
Several participants mentioned Vice-President Dombrovskis’ role in helping Latvia out of the crisis. “You are known in Latvia as someone who helped the country in the economic crisis. What do you think you will be remembered for?”, asked one participant, while another wanted to know more details about how did the austerity measures work and how did Mr Dombrovskis manage to maintain the support of Latvia’s citizens during those difficult times.
On the Capital Markets Union (CMU) a participant said that it offers an opportunity to open the borders to investments. However, he said that, after Member States failed to agree on the financial transaction tax, it was difficult to believe the CMU was going to work ‘because taxation is very important for investments.’
Another participant raised the question of imbalances in some EU countries: “Germany suggests we should have two Eurozone's. What do you think about it?”.
Turning back to Latvia, one participant wanted to know how the change to the Euro in Latvia had affected currency, GDP and economic growth. The social and income inequalities in the country were also discussed, as were the possible impacts of a deepening of the Economic and Monetary Union.
On the role of the Euro in the world, one participant said: “Latvia has had the euro as its currency for 5 years now. The dollar is still widespread in the world as the strongest currency. Will the euro replace the dollar on the international market?”
The credibility of credit rating agencies and Brexit were some of the other topics raised during the Dialogue.