BRUSSELS (MNI) – The following is a verbatim text of the statement
issued by European Council President Herman Van Rompuy late Thursday
night, after EU leaders’ finished the first day of their two-day summit
here.
The leaders agreed on the broad outlines of a permanent crisis
resolution mechanism for Eurozone states, which will be operational in
mid-2013, replacing the European Financial Stability Facility, which
expires then. The leaders made no progress on the issue of a capital
increase for the EFSF or the creation of jointly-issued Eurobonds — an
idea that is strongly opposed by Germany and France.
The following is Van Rompuy’s verbatim text:
“Tonight, we have done three important things.
Firstly, we decided on the limited Treaty amendment required for
Member States to establish a permanent mechanism to safeguard the
financial stability of the Eurozone as a whole.
Secondly, we have confirmed the general features of that permanent
mechanism.
Thirdly, we have outlined the follow-up of the overall economic
strategy which the European Council has been pursuing since the start of
the year.
First, regarding the Treaty amendment required for a permanent
crisis mechanism. Since our October meeting, I consulted the members of
the European Council about it. Tonight we agreed on a draft decision.
This includes the text of the Treaty amendment itself. It consists of
two sentences, to be added to article 136 of the Treaty:
“The Member States whose currency is the euro may establish a
stability mechanism to be activated if indispensable to safeguard the
stability of the euro area as a whole. The granting of any required
financial assistance under the mechanism will be made subject to strict
conditionality.” We agreed on this text after one hour and a half of
discussion.
This amendment will not increase the competence of the Union and
only affect the members of the Eurozone themselves. That’s why everybody
agreed to use a simplified revision procedure.
After an opinion of the European Parliament, the European
Commission and the Central Bank, the European Council will turn the
draft decision of today into a full decision, by March 2011 at the
latest. Then the amendment will have to be approved in each member
state.
The aim is for the amendment to enter into force on 1 January 2013
at the latest, so that the permanent mechanism itself can be in place in
June 2013.
Second, concerning the features of the stability mechanism. In
October, the Commission was asked to undertake the preparatory work. In
the meantime, that part of the work has been accelerated, resulting in a
statement by the Eurogroup Finance Ministers on 28 November. We fully
endorse as European Council that statement today.
Therefore the future European Stability Mechanism will be designed
on the basis of the current mechanism, so IMF involvement is foreseen.
As regards the role of the private sector, the EU will continue to
adhere strictly to standard IMF and international practices. Decisions
will thus be taken on a case by case basis and private sector
involvement will not be a prior requirement for support under the future
Stability Mechanism.
I come to the third point: we had a very good and in-depth exchange
of views on recent economic developments and on how to deal with the
challenges for all European economies, short term and long term. The
president of the Central Bank was also present.
The dinner discussion has confirmed the sense of determination and
unity amongst the member states and the institutions. Everybody around
the table shared the basic analysis. I insist: all 27 agree, even if the
analysis concerns specifically the 16 euro countries. We thus have a
joint strategy to make our economies crisis proof and to enhance
structural economic growth in Europe.
Let me mention the elements of this joint strategy. Three points
concern work to be done by the national governments. Fiscal
responsibility. Second, stimulating growth. Thirdly: the two countries
with support programmes are forcefully implementing the necessary
measures and we all welcome the efforts of those two governments, Greece
and Ireland, and their populations.
Two other points concern work to be done by the member states and
the institutions of the European Union together.
Firstly, the European Council requests the other institutions to
make sure that all the decisions adopted in October regarding the
Stability Pact and macro-economic surveillance will be in place by
summer 2011. It is our common duty.
Secondly, we agree to conduct new stress tests in the banking
sector to ensure full transparency in the broader context of the EU
annual exercise.
Furthermore, we express full support of the action of the ECB. We
support the ECB in its independent responsibility to ensure price
stability, solidly anchored inflation expectations and thereby
contribute to financial stability of the euro area. And we are committed
to ensuring the financial independence of the central banks of the euro
system.
Our determination is clear. The heads of state and government of
the Eurozone stand ready to do whatever is required to ensure the
stability of the Eurozone as a whole.
The political will of all member states and institutions to do what
needs to be done, is thus beyond doubt. In the course of this year, we
have collectively ensured the stability of the euro. The strong
political bonds between the members of the Union have been confirmed.
These decisions are about the determination of all those in the
European Union to continue to shape our future together, today and
tomorrow.”
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