EUROGROUP-COUNCIL OF THE EUROPEAN UNION interesting news

Eurogroup 12/7/2018  Main results - Eurogroup, 12/07/2018 The Eurogroup was briefed on the outcome of the June Euro Summit. It discussed the economic situation and the outlook for the euro area as well as the euro area's budgetary situation as a whole. A meeting about Bulgaria's intention to join the EU's Exchange Rate Mechanism (ERM II) took place in the margins of the Eurogroup. Main results Information from June Euro Summit Eurogroup President Mário Centeno informed ministers on the outcome of the Euro Summit, which took place on 29 June. He also briefly outlined the issues relating to the deepening of the Economic and Monetary Union on which the Eurogroup would be expected to work before the next Euro Summit meeting, scheduled to take place in December this year. These include terms of reference for the common backstop to the single resolution fund to be provided by the European Stability Mechanism (ESM), and a term sheet for the further development of the ESM, as well as a roadmap for the beginning of political negotiations on EDIS. The Eurogroup will also discuss all other elements listed in the Eurogroup president's letter of 25 June 2018 to President Tusk. Euro Summit, 29 June 2018 Euro Summit Statement, 29 June 2018 Letter from Eurogroup President Mário Centeno to European Council President Donald Tusk Presentation of the summer interim forecast The Eurogroup discussed the economic situation and the outlook for the euro area, on the basis of a presentation by the European Commission on its summer interim forecast. The Eurogroup regularly discusses the economic situation and economic policy challenges as part of its efforts to effectively contribute to economic growth and job creation. European Economic Forecast. Summer 2018 (Interim) Budgetary situation and prospects The Eurogroup held a discussion on the budgetary situation in the euro area as a whole, focusing on prospects for 2019. The results of this exchange will contribute to the preparation of the draft budgetary plans of the euro area member states and the recommendations for the euro area member states in 2019. The Chairman of the European Fiscal Board (EFB), Niels Thygesen, presented the EFB report. The EFB is an independent advisory body of the European Commission. It provides advice on matters related to the euro area fiscal stance. The Eurogroup is required by EU law to discuss the euro area's budgetary situation and prospects, in the framework of the assessment of the draft budgetary plans of the euro area member states. It therefore holds regular discussions on the euro area fiscal stance. European Fiscal Board (EFB) EFB report: Assessment of the prospective fiscal stance appropriate for the euro area Ireland and Spain: post-programme surveillance missions The European Commission and the European Central Bank presented to the Eurogroup the main findings from their post-programme surveillance missions to Spain and Ireland, which respectively took place in April and May 2018. The European Stability Mechanism presented findings in relation to its early warning system in both countries. The International Monetary Fund also informed about its recent Article IVconsultation with Ireland. According to the institutions' reports, the economic performance of both Ireland and Spain remains strong, and the risks in terms of the repayment of their respective loans are low to very low. Post-programme surveillance (PPS) is carried out in countries that have completed financial assistance programmes until at least 75% of the financial assistance received has been repaid. The purpose is to assess whether there are any risks to their ability to repay loans received during their programmes. Statement by European Commission and ECB staff following the conclusion of the ninth post-programme surveillance mission to Ireland Statement by the staff of the European Commission and the European Central Bank following the ninth post-programme surveillance visit to Spain Post-Programme Surveillance Report. Ireland, Spring 2018 Post-Programme Surveillance Report. Spain, Spring 2018 Ireland : 2018 Article IV Consultation Bulgaria's intention to join the EU's Exchange Rate Mechanism (ERM II)  In the margins of the Eurogroup meeting, the representatives from the euro area members states, the European Central Bank and Denmark met in the presence of the European Commission and of Bulgaria to discuss the prospects of Bulgaria's participation in the ERM II. The participants of the meeting adopted a statement. Statement on Bulgaria's path towards ERM II participation (press release, 12/7/2018) Letter by Bulgaria on ERM II participation PRESS

Council of the European Union    Council of the European Union    12/7/2018 | STATEMENTS AND REMARKS Remarks by M. Centeno following the Eurogroup meeting of 12 July 2018 Part 1 Good afternoon. We had a very productive meeting today, and a relatively short one – I hope you appreciate that.   In the June Euro summit, Leaders asked us to make further progress in all areas of the euro area reform plan included in my letter to President Tusk. This progress should be delivered in time for the December summit. As this is the second semester, we have little time and a lot of work to do over the coming months. Let me briefly recall the three workstrands that we have: First, on the Banking Union, we will need to work on a roadmap for beginning the political discussions on a European Deposit Insurance Scheme (EDIS). We also need to work on a possible framework for liquidity in resolution; and on measures to enhance the organisation of anti-money laundering (AML). We should also monitor progress with risk reduction. Finally, we should keep track of agreements reached on banking legislation and subsequent implementation. Second, on reform of the ESM, we need to prepare a term sheet by December 2018 covering the following elements: (i) the common backstop to the Single Resolution Fund; (ii) the review of the ESM toolkit, in particular precautionary instruments and possible new instruments; (iii) a stronger role of the ESM in programmes; (iv) debt sustainability issues; and (v) a review of how the ESM is governed. Finally, on fiscal capacity, we have two proposals by the Commission on the table – a stabilisation function and a reform delivery tool, within the Multi-annual financial framework (MFF) framework. In my letter to President Tusk, I have mentioned other ideas which should be pursued further: a possible euro area budget and an unemployment insurance fund, while acknowledging the concerns around moral hazard and the open questions on how these ideas could be financed. All this will require further work. We will be more focused in our discussions in each of the upcoming Eurogroups, without prejudice to taking decisions as a package by December. For our second agenda item, we took stock of economic developments based on the Commission forecast that was published today. Growth was very positive last year. It is now settling at a steadier pace. Despite the risks in the global economy, namely with tensions on trade, we are confident in the strength and resilience of the euro area economy. Years of reforms are now paying off. Employment is up. But clearly there are important challenges ahead in the global economy so we need to stay the course and continue sound economic policies. Economic forecasts are the starting point for our fiscal policies. Under our third item today, we discussed the budgetary situation and prospects for the euro area as a whole. Professor Thygesen presented the report published by the European Fiscal Board last month. We agreed that rebuilding fiscal buffers remains a priority for some countries with high debt levels. On the other hand, there are countries that have some scope to prioritise investments to boost their growth potential, while preserving the long-term sustainability of public finances. Ministers will feed this euro area perspective into their national budgetary preparations in the coming months. We will come back to the issue when we assess the draft budgetary plans for 2019 towards the end of this year. We then discussed Spain and Ireland post-programme surveillance. We congratulated both Nadia (Calviño) and Paschal (Donohoe) on the strong economic performance of their countries. We encouraged them to continue pursuing sound economic policies to safeguard the Spanish and Irish economies against downside external risks. After the Eurogroup meeting today, the ministers met with different hats, as the ESM Board of governors, to shortly discuss Greece. The update of the Greek Memorandum of Understanding and the authorisation for disbursement of the last tranche of €15bn was ratified by 18 countries. The final decision approving the formal closure of the review and providing green light for disbursement can be done as soon as all national procedures are completed. I expect this to happen in the beginning of August. This was the last meeting among ministers under an ongoing Greek programme. It was an opportunity to bid farewell to this program and welcome the Commission’s plan, presented to us today, to enact the post programme surveillance starting mid-August. Part 2 Today we had a special meeting to discuss a letter sent by the Bulgarian authorities on prior commitments to join ERM II and Banking Union. For that we welcomed in the room Denmark, as member of ERM II, and Bulgaria - represented by the finance ministers and central bank governors. I am very glad to announce that the constructive discussions of the past few months on the roadmap towards Bulgaria's accession to ERM II have paid off and that we were able to come to a successful outcome today. We welcome the commitments taken by the Bulgarian authorities in the areas of banking supervision, other financial sector issues and institutional quality and governance. They are highly relevant for a smooth entry and participation in ERM II. Our assumption is that Bulgaria will simultaneously join ERM II and the Banking Union and will take further commitments at that point in time which is standard practice in ERM II applications. Bulgaria is committing to enter into close cooperation with the ECB. This follows already existing procedures. Other additional commitments put forward relate to other financial sector issues, as I said, and institutional quality and governance. These series of commitments show Bulgaria’s determination to be part of the euro family. It also shows that the euro area is a solid anchor of stability and growth in Europe that continues to attract new members. This is not surprising. The euro today offers a more solid construct than before the crisis, namely with projects like Banking Union that reinforces our ties. I should stress that we expect to follow a similar approach in the future for other Member States wishing to join ERM II and the Banking Union, in line with the principle of equal treatment. 13/7/2018 2018 country-specific recommendations on economic, employment and fiscal policies On 13 July, the Council concluded this year's "European Semester" exercise, the annual monitoring process aimed at ensuring economic convergence and stability in the EU. The Council issued its 2018 recommendations and opinions to member states' on their economic, employment and fiscal policies. The recommendations had been endorsed by the European Council in June. The overall objective of this year's recommendations is to encourage member states to use the current favourable economic momentum to further strengthen the resilience of their economies. On 13 July, the Council concluded this year's "European Semester" exercise, the annual monitoring process aimed at ensuring economic convergence and stability in the EU. The Council issued its 2018 recommendations and opinions to member states' on their economic, employment and fiscal policies. The recommendations had been endorsed by the European Council in June. The overall objective of this year's recommendations is to encourage member states to use the current favourable economic momentum to further strengthen the resilience of their economies. The European Semester involves simultaneous monitoring of the member states' economic, employment and fiscal policies during a six-month period every year. In the light of policy guidance given by the European Council annually in March, the member states present each year in April: national reform programmes for their economic and employment policies. These include a macroeconomic scenario for the medium term, national targets for implementing the ‘Europe 2020' strategy for jobs and growth, identification of the main obstacles to growth, and measures for growth-enhancing initiatives in the short term; stability or convergence programmes for their fiscal policies. Eurozone countries present stability programmes, whereas non-euro member states present convergence programmes. These set out medium-term budgetary objectives, the main assumptions about expected economic developments, a description of fiscal and economic policy measures, and an analysis of how changes in assumptions will affect fiscal and debt positions. The Council then adopts country-specific recommendations (CSRs) and opinions. The 2018 CSRs are addressed to 27 of the EU’s 28 member states. To avoid duplication there is no CSR for Greece, as it is subject to enhanced policy surveillance under an economic adjustment programme. In May 2018, the Council adopted a specific recommendation on the economic policies of the euro area. It did so at an earlier stage so that eurozone issues be taken into account when approving the country-specific recommendations. The recommendations can be found in the following documents: Austria Belgium Bulgaria Croatia Cyprus Czech Republic Denmark Estonia Finland France Germany Hungary Ireland Italy Latvia Lithuania Luxembourg Malta The Netherlands Poland Portugal Romania Slovakia Slovenia Spain Sweden United Kingdom European Semester - Council website July 2018 country-specific recommendations - chapeau document Council recommendation on the economic policies of the euro area, 14 May 2018 Council of the European Union    12/7/2018  Statement on Bulgaria's path towards ERM II participation Today the Finance Ministers of the euro area Member States, the European Central Bank (ECB), the representatives of the Minister of Finance and of the Central Bank Governor of Denmark discussed the prospects of Bulgaria's participation in the Exchange Rate Mechanism (ERM II) in the presence of the Commission, the Bulgarian Finance Minister and Central Bank Governor, and issued the following statement. We welcome the intention of the Bulgarian authorities to put in place the necessary elements for a successful entry into ERM II.  Following constructive discussions with the ECB, the Commission, the euro area Member States and Denmark, Bulgaria has taken a number of commitments in policy areas which are of high relevance for a smooth transition to, and participation in, ERM II. With regard to, in particular, banking supervision, Bulgaria is expected to send a request to enter into close cooperation with the ECB in line with the existing procedures, and will undertake the necessary preparations accordingly – including support to the ECB’s comprehensive assessment. Additional commitments relate to other financial sector issues and institutional quality and governance. Such reform efforts towards a more robust financial sector, stronger institutions and more efficient economic structures will contribute to the successful participation of Bulgaria in ERM II. The ECB and the Commission will monitor the effective implementation of these commitments acting within their respective areas of competence as provided for by the Treaties and secondary legislation. Once they have provided a positive assessment, a decision will be taken by the ERM II parties on the formal application of the Bulgarian authorities for ERM II participation. The decision will be linked to the ECB decision on close cooperation, in full respect of the conditions specified in the legal framework. This would imply that Bulgaria simultaneously joins ERM II and Banking Union. The ECB could be expected to conclude its comprehensive assessment within approximately one year after Bulgaria's formal application for close cooperation, and its decision may make the start date of close cooperation conditional on Bulgaria’s progress in implementing the possible measures required in relation to the results of the comprehensive assessment. In line with the relevant secondary legislation, Bulgaria will also participate in the Single Resolution Mechanism (including the Single Resolution Fund) from the date of entry into force of the ECB decision on close cooperation. Therefore, as from that date Bulgaria should be subject to the obligations stemming from the Intergovernmental Agreement on the transfer and mutualisation of contributions to the Single Resolution Fund, notably the obligation to transfer those contributions to the Single Resolution Fund in accordance with the relevant provisions thereof. To these effects, Bulgaria is expected to take all the necessary steps in order to ratify and deposit its instrument of ratification in due course before the decision on close cooperation enters into force. In line with past practice, Bulgaria is also expected to take further commitments at the moment of joining ERM II with the aim of achieving a high degree of sustainable economic convergence by the time the euro will be introduced. We call on the Bulgarian authorities to thoroughly implement the reforms monitored by the Commission under the Cooperation and Verification Mechanism in the areas of judicial reform and the fight against corruption and organised crime in Bulgaria, in light of their importance for the stability and integrity of the financial system. In the future, we expect to follow a similar approach for Member States wishing to join ERM II, in line with the principle of equal treatment. Letter by Bulgaria on ERM II participation Last reviewed on 13/07/2018