COUNCIL OF THE EUROPEAN UNION-EUROGROUP latest

PRESS

Council of the European Union   7 SEPTEMBER 2018

Presidency press release after the first day of the informal meeting of economic and financial affairs ministers of 7-8 September 2018 in Vienna, Austria Federal Minister Hartwig Löger at the informal meeting of economic and financial affairs ministers BKA/Michael Gruber Press release Federal Minister Löger: Europe is working on rules and regulations for crypto assets to support the development of the sector #eu2018at Published 07 Sep 18:10 Good start at the informal meeting of economic and financial affairs ministers (ECOFIN) under the Austrian Council Presidency. European Investment Bank (EIB) issues, key interest rates and crypto assets as agenda items on day one. Austria’s Minister of Finance, Hartwig Löger, has put the topic of “crypto” on top of the financial agenda during the Austrian Council Presidency. According to Löger, Europe currently lacks uniform rules for the handling and trading of crypto assets: “Currently, this market is largely unregulated, particularly in comparison with other sectors. For us, it is a question of clear rules of the game for companies, customers and consumers in order to make crypto assets usable as financial instruments, and not a question of excessive regulation.” “With a vision for Europe, we want to make the location more attractive for crypto assets and develop a European plan to position ourselves more strongly in this emerging segment,” says Löger. Initial coin offerings (ICOs) can be a valuable tool for European companies to gain access to funding. Funding via ICOs reached a volume of more than US$ 7 billion in March 2018. There was a dramatic decline to US$ 926 million in July. Growth-promoting regulation should tap this potential for European companies as a serious financing instrument and enable stable market development. At the same time, the investment universe will be expanded by high-quality ICOs, and consumers get access to alternative investment opportunities. Close coordination between legislators, regulators and industry is crucial for the development of these promising markets. “At our first working meeting, together with the governors of the central banks we discussed the possible effects of the expected rise in key interest rates in order to draw the right conclusions in terms of fiscal policy. It is important for all member states to be prepared for the normalisation of interest rate policy announced by the European Central Bank (ECB), to implement the corresponding structural reforms, and to reorganise their public finances,” emphasises Austrian Finance Minister Hartwig Löger. The agenda for the second day of the meeting on 8 September will focus on the deepening of the Economic and Monetary Union and on the issue of fair taxation of the digital economy. 7/9/2018 | Remarks by M. Centeno following the Eurogroup meeting of 7 September 2018 Good afternoon. We had some good discussions at our Eurogroup meeting today. We welcomed a number of distinguished guests, starting with Roberto Gualtieri, the Chair of the European Parliament's ECON committee. It was a lively and interesting discussion on our current economic outlook which remains a positive one, after five quarters of vigorous expansion. We also exchanged views on our policy mix and the need to explain to our citizens the current plans to improve the euro area. This is the first time that the ECON committee chair attends the Eurogroup. I know I speak for all my colleagues around the table when I say that the Eurogroup takes transparency and exchange of information very seriously. Ministers are accountable to their national parliaments for their Eurogroup activity. We all stand to benefit from a good dialogue with the European Parliament on the Eurogroup's work and policy priorities. In this spirit, I’ve also informed ministers of my intention to look at the transparency initiative adopted by Eurogroup back in 2016, to consider if they can be further improved.  Today we also had a thematic discussion on how to make labour markets more efficient. We had the great pleasure to exchange ideas with an authority in this matter, Professor Pissarides, the Nobel Prize laureate. He spoke to us about artificial intelligence and the impact it will have on labour markets for the generations to come. He agreed to make his presentation public. We recognised that investments in human capital need to respond quickly and efficiently to new economic opportunities to make our economies more resilient. The Commission's analysis of this issue shows that euro area member states have made good progress but there is still quite some way to go. This is the second time we welcomed a prominent academic to provide food for thought for the Eurogroup policy discussions and we will continue to do this in the future.  Today we also discussed Portugal, my own country. We were debriefed by the European Commission and the ECB on the main findings of the eighth post-programme surveillance mission carried out in June, and also by the ESM on the findings under its early warning system. The mission witnessed the good performance of the Portuguese economy. Looking forward, and given external risks across the board, the resilience of the economy to shocks must continue to be strengthened and the public debt must continue to be reduced.  Finally, we picked up our ongoing discussions on the euro area reform, following the June Euro Summit. For that, we welcomed non euro area ministers in the room and we looked at how to organise our work until December. It is a very ambitious and challenging agenda for the next four months. Leaders asked us to cover all the items mentioned in my letter of 25 June to President Tusk, as mandated by the Euro Summit of June. We already started today with a discussion on the common backstop to bank resolution. We addressed two key issues here: (i) When does it start and (ii) Who can decide on the activation of this new ESM instrument. As regards the possible early introduction, the current entry date is 1 January 2024. Under a certain set of conditions, we could bring this forward. We have mandated our deputies to explore what conditions and legal changes would be needed for this to work. Regarding the decision-making, we are closer to an agreement, although some details still need to be fleshed out. Clearly, decisions must be swift, timely and allowing national parliaments to be involved, as necessary. In the next few months, we will address all other EMU deepening topics in turn. It will be intense and we will probably need an extra Eurogroup meeting for that matter. But until December these will be only discussions. As they say: nothing will be agreed until everything is agreed. In December, we will wrap up and prepare a decision by the Leaders in the Euro Summit. Overall, I am happy to see a constructive spirit around the table. We have busy months ahead of us but I am confident that we will be able to deliver in time for December. Main results - Eurogroup, 07/09/2018 Ministers exchanged views on the euro area's economic outlook and discussed allocative efficiency in labour and product markets. In a meeting of ministers of 27 EU member states, the Eurogroup  Main results The Eurogroup meeting took place in two formats: a regular meeting of the euro area ministers, and a meeting of the ministers of 27 EU member states to discuss issues related to the deepening of the Economic and Monetary Union. 9.00 - Eurogroup meeting in regular format Exchange of views with the Chair of the European Parliament's Economic and Monetary Affairs Committee The Eurogroup exchanged views with Roberto Gualtieri, Chair of the European Parliament's Committee on Economic and Monetary Affairs (ECON), on the euro area's economic outlook and challenges. The Eurogroup President regularly appears at the European Parliament's ECON Committee, for an economic dialogue on the Eurogroup's work and policy priorities. President Centeno's initiative to invite the Chair of the European Parliament's ECON Committee for a dedicated exchange of views aims to further strengthen the dialogue between the European Parliament and the Eurogroup.  Thematic discussion on allocative efficiency in labour and product markets The Eurogroup discussed allocative efficiency in labour and product markets on the basis of a Commission analysis. A country's ability to allocate resources efficiently in labour and product markets enhances economic resilience and is thus particularly relevant for the euro area. Ministers also heard a presentation by Christopher Antoniou Pissarides, Professor of Economics at the London School of Economics and Nobel Prize laureate. Professor Pissarides talked about the impact of artificial intelligence and automation on labour markets. Allocative efficiency in the euro area - Note from the Commission Labour Market Challenges in Europe - Presentation by Christopher Pissarides Portugal: 8th post-programme surveillance mission The Eurogroup was informed about the key findings of the 8th post-programme monitoring mission to Portugal, which took place from 5 to 12 June 2018. The key objective of post-programme monitoring is to assess a country's capacity to repay loans granted under its earlier programme. It comes to an end when at least 75% of the loans received have been repaid. Statement by European Commission and European Central Bank staff following the Eight Post-Programme Surveillance mission to Portugal Financial assistance to Portugal: Post-Programme surveillance (European Commission) 10.30 - Meeting of 27 member states Deepening EMU: follow up to the June Euro Summit, including common backstop issues Ministers discussed the follow-up to the June 2018 Euro Summit, which had agreed that the Eurogroup would further discuss all the items related to the deepening of the EMU listed in President Centeno's letter of 25 June. The Eurogroup agreed to further look into these topics in a sequential manner at its upcoming meetings in preparation of the December Euro Summit. At this meeting, the Eurogroup discussed in particular issues related to thecommon backstop to the Single Resolution Fund (SRF). The Euro Summit of June 2018 agreed that the ESM would provide the common backstop to the SRF and that the Eurogroup would prepare terms of reference on this matter by December 2018. Euro Summit, 29 June 2018 Statement of Eurogroup and ECOFIN Ministers on the SRM backstop, December 2013 Council conclusions on Banking Union, June 2017 Single Resolution Mechanism (background information)