Deeper euro zone integration

EPA-EFE/TIAGO PETINGA

EU Commissioner for Economic and Financial Affairs, Taxation and Customs, Pierre Moscovici, talks to the participants during a meeting on the last day of the Council #ProgressiveEurope: Renewal, in Lisbon, Portugal, 02 December 2017.

Deeper euro zone integration


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The European Union tax commissioner, Pierre Moscovici, said plans to deepen the integration of the euro zone will make the entire bloc more united and improve democratic accountability of euro zone institutions.

A package for the 19 countries sharing the euro will be unveiled by the European Commission on December 6. According to Moscovici, it is aimed at making the single currency area more resilient to potential future crises and would follow two guiding principles.

“First, that it should advance the unity of Europe through greater convergence within the euro area and the wider Union. Second, that it should make the governance of the euro area more democratic and efficient at the same time,” he said.

As reported by the Reuters news agency, the approach is to alleviate concerns among non-euro zone countries that deeper integration would make them second-class members of the EU, with less say and funds in the future.

The Commission package will address ideas floated by French President Emmanuel Macron on creating a euro zone budget, a euro zone finance minister and a euro zone parliament.

Other ideas include transforming the euro zone bailout fund into a European Monetary Fund and setting up a sovereign insolvency mechanism — a German-supported project.

According to Reuters, there are also plans to help the European banking system by setting up a Europe-wide bank deposit insurance scheme.

The ideas will be discussed during the euro summit of the 27 leaders on December 15.

“Frankly I don’t expect any major step forward from the Eurogroup tonight, because as you know member states are not totally aligned. And also there is no government in Germany, so there cannot be decisions at this time and we all know that,” Moscovici told reporters.

Under the current arrangement, the chairman of euro zone finance ministers often testifies before the parliament’s economic committee, but it has no power over him.

According to Reuters, the EU finance minister, under the Commission proposals, would also be in charge of the European Stability Mechanism (ESM) bailout fund and be a senior member of the EU executive arm. But this proposal is unlikely to find broad support among euro zone governments.

“This is not about a Commission power grab. It is not about turf wars. It is about mechanisms that ensure proper democratic, transparent, accountable decision-making,” Moscovici said.

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