Speech: Vice-President Rehn’s remarks at the ECOFIN

Olli REHN – Vice-President of the European Commission and member of the Commission responsible for Economic and Monetary Affairs and the Euro

ECOFIN Press Conference

Brussels, 14-2-2013 — /europawire.eu/ — Good afternoon. Mr. Noonan gave a comprehensive and concise summary of the meeting today. I will only focus on two of the points that were on our agenda today.

Firstly, I want to say that the Commission fully supports the Council conclusions as agreed today on the Annual Growth Survey. The AGS has a very strong focus on the need to boost competitiveness, particularly in view of the decline in manufacturing employment in Europe over the past decade: 2.5 million jobs in our four largest Member States alone have been lost. We need to reverse this downward trend. And we can do so, provided we stay on the reform course. Not reform for its own sake, but reform for the sake of restoring sustainable growth and job creation.

As the AGS and Council conclusions underline, this means investing in education and training, and continuing reforms in our labour markets to remove obstacles to job creation. It means supporting entrepreneurship and investment and completing the single market. It means finishing the job of financial repair to boost the flow of credit to SMEs and households. It means supporting public investment, as has recently been done with the capital increase of the European Investment Bank. And it also means designing smart regulation that achieves societal and environmental objectives without hampering job creation and competitiveness.

All of these policies for growth will be reflected in the country-specific recommendations, which the Commission will present in the coming spring. And I trust that they will feature prominently in Member States’ national reform programmes. In fact, making effective use of the European Semester will be a crucial test of Europe’s credibility and determination to stay the reform course.

This brings me rather neatly to my second point, which is the forthcoming G20 finance ministers meeting in Moscow, which we also discussed today and where we are heading together with Minister Michael Noonan. In this context, a word on the issue of exchange rates, on which the G7 issued a joint statement earlier today clarifying the joint position of its partners.

On numerous occasions, the G20 has reaffirmed its members’ shared interest in a strong and stable international financial system, with market-oriented exchange rates reflecting economic fundamentals. And we, as the European Union, have consistently underlined this in G20 meetings as well as in the context of the G7. That’s why we welcome today’s statement by G7.

Excess volatility and disorderly movements in exchange rates can have adverse implications for economic and financial stability and that’s why we have to lean on active policy coordination in order to prevent a wave of competitive devaluations. While exchange rates are never a policy target they, of course, have an impact on growth and inflation, and thus they have an indirect impact on the assumptions of policy making concerning monetary policy and other policy areas.

In this context, the G20 has committed to consult closely with regard to actions in exchange markets and to cooperate as appropriate. I expect that this commitment will be reaffirmed in Moscow, as it has been today reconfirmed by the G7 in the joint statement.

Thank you.