HIGHLIGHTS-Comments by European Union finance officials

Oct 18 (BestGrowthStock) – Following are comments by European Union
finance ministers and other officials attending talks in
Luxembourg on Monday.

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For a story on the talks, click on [ID:nLDE69H0LZ]

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AT THE FINAL NEWS CONFERENCE:

JEAN-CLAUDE JUNCKER, EURO GROUP CHAIRMAN AND LUXEMBOURG
PRIME MINISTER

“Now the (European) Council (of EU governments) and the
(European) Parliament can start to build the reform so that
strengthened governance will become operational by 2012 and the
European semester will start on 1st January next year.”

On Greece:

“We have every confidence in the ability of the Greek
government to meet the deficit targets contained the programme
… The revisions of the deficit figures will not affect
Greece’s obligations concerning deficit reduction.”

“I can confirm that the Greek government did not ask (at
meetings in Washington) for an extension of the repayment period
for the loans made to it.”

On Portugal:

“We do hope that the major parties will join in making these
efforts so that the Portuguese parliament will adopt the budget
for 2011.”

On Europe’s representation on the IMF’s governing board:

“We didn’t have much time to look at the issue of IMF
reform. We weren’t able to talk about questions of
representation. We’ll be discussing these issues at a future
meeting.”

On exchange rates

“It’s important that exchange rates should reflect economic
fundamentals. Excessive volatility and disordered currency
movements which we have observed in recent weeks do have some
negative effects on economic and financial stability on a global
scale. At the G20 summit in Toronto the emerging economies did
undertake to carry out reforms and improve flexibility in their
exchange rates. So we shall be continuing to carefully watch
developments in the exchange markets and we should be
cooperating in the appropriate ways.

EU ECONOMIC AND MONETARY AFFAIRS COMMISSIONER OLLI REHN

On new budget rules:

“I am satisfied with progress made and with the convergence
achieved in line with the Commission’s incentives to reinforce
economic governance.

“I have called on the (European) Council and the (European)
Parliament to work on a rapid and fast procedure so as to
deliver the legislative decisions by the summer of next year so
we should have a new system of economic governance broadly in
force by next summer when we have the next major round of
assessments of effective action.”

On Greece, Ireland and Portugal:

“The governments in these three countries will be able to
meet the fiscal targets with the consolidation measures that
they have taken and they are also taking very substantial
efforts in structural reforms.”

DUTCH FINANCE MINISTER JAN KEES DE JAGER

“It was an uphill battle and at times it seemed Europe would
come out empty handed. Fortunately, in a concerted effort we
managed to achieve significant progress with regard to sanctions
that will make Europe stronger and healthier in the long run.
This is good for all of us.”

BEFORE THE FINAL PRESS CONFERENCE:

GERMAN DEPUTY FINANCE MINISTER JOERG ASMUSSEN

“The agreement between Germany and France was the basis for
tonight’s (finance ministers’) agreement.

“We have been able to agree today after lengthy and
intensive deliberations on a report by the Van Rompuy task force
to the European Council. It has been approved without dissenting
votes and it also has no more square brackets.”

“We see … it as a clear strengthening of the growth and
stability pact.”

“It is important for us that the efforts under the mandate
of the task force continue. In future, there will be a robust
crisis management mechanism. It will consist of several
elements. We will continue to discuss that for such a mechanism
but also for other questions, treaty changes can be possible.”

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SWEDISH FINANCE MINISTER ANDERS BORG

“With the deals today, we see a broad-based improvment of
the fiscal structure in the EU, with respect to enforcement of
the debt criteria, enforcement of the preventive arm and of
course more automatic sanctions.

“The European Council can of course discuss other proposals,
treach changes such as voting rights.

“Today, we reached a broad-based agreement that will improve
the fiscal policy.

We (Sweden) believe we should work as far as possible with
measures that can implemented fast, that means without treaty
changes.”

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POLISH FINANCE MINISTER JACEK ROSTOWSKI

“There is an agreement on … a significantly strengthened
preventive action and a significantly strengthened system of
imposing sanctions.

“We are going in the right direction. There is also a high
degree of agreement on the permanent system of crisis
resolution. We can be satisfied with progress we have made.”

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SPANISH ECONOMY MINISTER ELENA SALGADO

On automatic sanctions:

“They are now discussing this amongst the 27. We have
already discussed it between the 16.

“We all accept that there could be an inverted QMV, we all
accept that there could be a inverse majority, changing a little
bit the rules of voting, leaving some room for the Commission to
also play a role.

“This means a qualified majority to halt the process of
sanctions, but this is still being discussed.”

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POLISH FINANCE MINISTER JACEK ROSTOWSKI

On efforts to enforce budget discipline:

“Automatic and semi-automatic sanctions are a key element
around which the discussion is proceeding.”

“The only circumstances in which we can accept such
sanctions is establishing a level playing-field.

“We are very much in favour a mechanism that would involve a
very far-reaching strengthening of fiscal discipline.

“The most important issue apart from semi-automaticity of
sanctions, is a permanent crisis-resolution mechanism. It would
be a good thing to have one.”

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ANDERS BORG

On enforcing budget discipline:

“The core message of this meeting is that we can have no
diluting of the framework. We need a more stringent framework,
not a more flexible one, so the efforts to dilute the framework
must be stopped.”

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EU ECONOMIC AND MONETARY AFFAIRS COMMISSIONER OLLI REHN

On the European economy and reforms of economic governance:

“We have a number of important meetings today and tomorrow
… the key issue certainly will be to restore and reinforce
confidence into the European economy.”

“This is now the moment of truth for the EU member states
whether they are genuinely for reinforced economic governance or
not, especially an effective enforcement mechanism and the focus
on debt are the cornerstones of these proposals … passing them
is the litmus test for being serious about economic governance.”

“It maybe be very chilly here but I don’t yet see any cold
feet. But I trust all the member states are ready to back their
words with deeds and pursue genuine reinforcement of economic
governance and support the proposals made by the Commission on
and effective reinforcement mechanism including timely sanctions
as well as well as on the increased focus on debt
sustainability.

“These are really the cornerstones of the proposals.”

On his expectations that the Portuguese draft budget for
2011 will be passed:

“I trust so, because it is a bold and significant step
towards stabilising public finances in Portugal and I am
confident that this budget will be passed.

“It is a very demanding budget, I am aware of that.

“On the other hand the economic situation, especially the
fiscal situation, in Portugal is very serious, which calls for
bold and determined action in order to stabilise public
finances.”

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FINNISH FINANCE MINISTER JYRKI KATAINEN:

On level of the euro and whether there should be a global
deal on currencies:

“Everybody, I think, shares the view that we don’t need
currency wars, but it isn’t my duty to speculate about currency
rates. It’s up to the ECB.”

On whether progress is possible on budget discipline:

“I hope we could close the case so to speak, because we need
as automatic as possible sanctions. It’s a question of equal
treatment of members states and also it’s the best way to avoid
this kind of crisis we have seen during the last two years.

“Also we need as specific debt criteria as possible, because
currently we haven’t had transparent debt criteria and everybody
knows, especially now when countries are taking more and more
loans from the market, the debt criteria is becoming more and
more important. So those two things: sanctions and debt criteria
they should be as specific and automatic as possible.”

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DUTCH FINANCE MINISTER JAN KEES DE JAGER

On currencies and competition:

“Countries should not use their currencies as means of
competition, but they should use the competitiveness of their
labour market, costs, production and innovation.

“Currencies should not be used, because it will lead to
unfair competition.

“We support as automatic as possible sanctions, there will
be very strong debate today about the Maastricht Pact. We do
need to improve it. We do need to sanction it, and we do need as
automatic as possible sanctions. A lot of member states are
getting cold feet now, but during the crisis this spring, we saw
what the sovereign debt crisis can do.”

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(Reporting by Marcin Grajewski, Annika Breidthardt)

(Brussels newsroom, +32 2 287 6830)

HIGHLIGHTS-Comments by European Union finance officials