G20 Summit in Pittsburgh (24-25 September) (debate) 
President
The next item is the comments of the Council and the Commission on the G20 Summit in Pittsburgh, to be held on 24-25 September 2009.
Cecilia Malmström
Mr President, it is a great pleasure for me to be here today representing the Swedish Presidency. The Presidency and the Commission will jointly represent the EU at the G20 Summit in Pittsburgh on 24-25 September. We will hold an informal European Council in Brussels tomorrow to prepare the EU's common position. As you will all be aware, the global financial crisis has necessitated unprecedented global measures:
Firstly, rapid and forceful financial and monetary policy measures to support the financial sector and the real economy. Secondly, coordination of global efforts and development of the role of the G20 as a forum for such coordination, including for measures concerning regulation of the financial markets. The financial and monetary policy measures that were able to be taken quickly were entirely necessary to get us through the worst of the crisis.
The overall support to the EU economy this year and next year is estimated at 5% of GDP. The central banks have responded to the crisis by keeping interest rates close to zero. Today we are cautiously optimistic that the worst is behind us as far as the acute problems of the financial sector are concerned, but the economic situation remains unstable and there is a considerable risk of further setbacks. We are very aware that rising unemployment will be a very dominant issue in the time ahead. The situation remains uncertain, but it could have been much worse.
Coordination and cooperation at international level will be incredibly important if we are to ensure a broad recovery and to set the tone for a return to long-term, sustainable growth based on a firm foundation. The G20 has played, and will continue to play, a central part in this. The G20 will also work with the international financial institutions of the IMF and the World Bank to guarantee that they have sufficient resources and a well-functioning internal organisation so as to be able to support economic growth and ensure financial stability throughout the world.
The G20 process has had the following significant results:
Firstly, that we have a common analysis of the problems that have affected our economies. That may not sound like great progress, but a shared view of the financial sector and the real economic problems that lie behind the crisis is essential for effective countermeasures.
Secondly, we have made real progress with a number of specific measures that we agreed on in London at the spring summit. These include a comprehensive stimulus package for our economies and a strengthening of cooperation on the supervision and regulation of the financial markets. Furthermore, we have ensured that the International Monetary Fund has sufficient resources to meet demand for borrowing. We have also undertaken to improve the ability of the international financial institutions to give warning in good time should similar problems arise in the future.
Much remains to be done, but we have made clear progress that has been driven forward by coordinated international commitments. I feel that we in the EU, along with the other members of the G20, have made great progress on a number of central issues that are crucial if we are to provide a strategic response to the economic and financial crisis. Our coordinated EU strategy means that Europe is leading the debate, rather than following it. It is our solutions that are being noted when global solutions are drawn up. That is why the Presidency is inviting the Heads of State or Government to a dinner tomorrow evening. The aim is to build further on the successful work of the informal Ecofin lunch and the meeting of G20 finance ministers in London, so that we will be well prepared on arrival in Pittsburgh.
I expect the meeting tomorrow and the summit in Pittsburgh to continue to result in progress on the main issues that I have mentioned, but also in a few other areas besides. One issue that has been raised in strong terms by a number of European finance ministers is the question of the part played by bonus systems in financial stability. EU finance ministers are unanimous that we should lead demands for effective global standards to ensure that such bonus systems do not have destabilising effects and that the bonus payments are reasonable in relation to performance. This is an important part of the overall initiative to ensure greater transparency and better supervision of the financial sector and it is crucial if we are to be able to secure future stability.
The Financial Stability Board has been asked to report to the Pittsburgh Summit regarding its work on developing principles for bonus systems. I hope that this report will contain specific strategies that can be implemented in practice and which guarantee the introduction by financial institutions of sensible, responsible remuneration and bonus structures. Moreover, I hope that we can agree to continue to provide the necessary stimulus to our economies as long as it is needed, but it is also important that we undertake to remove the measures when they are no longer required so that we can return to balanced public finances when the recovery comes.
We have only just begun to reflect on these exit strategies. Their form and coordination, and how they are implemented, will be a highly important component if we are to achieve a balanced, long-term economic recovery. Employment is another major challenge. We need to carefully design the measures required, while at the same time maintaining a good balance between financial and structural policy. I am sure that we will also repeat the need to maintain a stand against protectionism and to ensure fair play on the global markets. This will require significant coordination of financial regulation and supervision, but also as regards the removal of extraordinary measures taken to support the financial sector. Extensive work will continue to be required both at national and EU level.
Discussions concerning reform of financial institutions will continue tomorrow and in Pittsburgh, but also during the rest of the year. We want them to be strong, with sufficient resources, the right mandate, with political guidance and management structures that correctly reflect their composition. These matters are complex and interlinked, but we must get to grips with them as a matter of urgency so that the financial institutions can do this work which is becoming increasingly important.
Finally, I would like to say that naturally there is a great need for political decisiveness if we are to make progress in the discussions ahead of the climate summit in Copenhagen. This is a very high priority for the Swedish Presidency. We want to ensure that the right incentives are in place for everyone to take action to limit global warming and to adapt economic strategies so as to favour climate-friendly development.
Our goal is for the Pittsburgh Summit to make progress on guidelines for financing global climate measures. I cannot promise that we will achieve everything we want to, because these issues are highly complex, but we promise that the Presidency will assert and defend the EU's views in a responsible manner. In this spirit I look forward to fruitful discussions with the Heads of State or Government tomorrow evening and the real results that the world is expecting from Pittsburgh next week.
(Applause)
Joaquín Almunia
Mr President, Mrs Malmström, ladies and gentlemen, this is my first time before the House in this new legislative term. I want to start by congratulating all of you on your election, or re-election in many cases. I am sure that we all share a sense of responsibility with regard to tackling one of the greatest political challenges of our generation: how to overcome this deep economic and financial crisis. We have to restore confidence and stability for our citizens, while increasing their opportunities and ensuring the highest possible level of social cohesion for everyone.
The issue that will be on the table at the G20 Summit in Pittsburgh next week is at the heart of this challenge and this concern. I am convinced that this issue will keep coming up throughout the next period and throughout this Parliament's legislative term, regardless of whether these issues are discussed at G20 summits or European Councils, in your own debates or in the proposed initiatives that the next Commission will bring before this House.
The G20 Summit in Pittsburgh is the third to be convened at the level of Heads of State or Government since the collapse, one year and one day ago, of Lehman Brothers and the start of a crisis of proportions not seen for many decades.
In light of the first two top-level G20 meetings in Washington last November and in London in April of this year, it is clear that the G20 is playing a decisive role in coordinating the global response to this crisis.
The G20's contribution to the development of a coordinated response has been vital in avoiding an even deeper recession than the one we are currently experiencing. It has also been vital in establishing the foundations of an economic and financial system that will, in the future, prevent a repeat of the imbalances and excesses that have led us to the current situation.
The European Union has played an active and decisive role in encouraging the G20 in this respect. As recalled yesterday in this House by President Barroso, the first summit in Washington was a European initiative by the French Presidency and President Sarkozy, together with the Commission. The European Union also made a decisive contribution in terms of setting ambitious objectives for the two previous summits and actively participating in the preparatory work for these summits, in order to achieve not only declarations of principle, but also concrete results and commitments.
All Europeans, as well as the European institutions, should feel satisfied about all this. We can also be reasonably satisfied about the level of coordination that has existed between the various European representatives on the G20: the European countries that are G20 members and participate in the G20 meetings as such, plus the Presidency of the European Union together with the Commission, the latter representing the voice of all Europeans and the common position of all Member States.
The Washington Summit last November allowed the world's main economies - the G20 countries account for around 90% of world GDP - to agree on the implementation of stimulus plans to support economic activity at that time, last autumn, when credit, international trade and investment came to a sudden halt as a result of the tremendous financial shock, which first occurred in August 2007 and which then gained incredible momentum in September 2008.
A few days after the Washington Summit last year, the Commission proposed the European Economic Recovery Plan, which received the political support of the European Council in December. This plan has formed the basis of the European response in terms of fiscal policies and policies to stimulate demand through instruments which are in the hands of national governments and parliaments, or which are in the hands of the European institutions themselves.
Based on the most recent information available, these discretionary fiscal stimuli, together with the action of the automatic stabilisers, which are very important in the European countries due to the weight of our taxes and social welfare system, are predicted to add, as a contribution to total demand, the equivalent of 5.5% of EU GDP between 2009 and 2010.
The new US administration has also adopted a very significant stimulus plan. Given that its automatic stabilisers are not as extensive as ours in Europe, the total sum of direct stimuli plus automatic stabilisers means that similar support is being given on both sides of the Atlantic. In addition, countries such as Japan, China, Canada and other G20 members have also adopted equivalent fiscal stimuli.
The London Summit at the beginning of April insisted, in this respect, on the need to quickly put these plans into practice. It called for close monitoring of these plans and said that, if necessary, they should be supplemented by additional measures. We can now confirm that these stimulus plans, together with the very significant monetary stimuli adopted by the central banks, plus the mobilisation of public resources in support of financial institutions, particularly the banks, have managed to halt the economy's freefall. They are also now allowing us to see, this autumn, the first signs of stabilisation, as is apparent from the economic forecasts that I had the opportunity to present two days ago in Brussels. For the first time in two years, these forecasts have not revised the previous forecast downwards.
However, we are not yet able to say that economic activity could sustain itself if these stimuli were removed. It is also true that, even with the stimuli that are being applied, there are risks of a relapse given the extremely worrying rise in unemployment and the as-yet unresolved weaknesses in the financial system.
As a result, one of the messages that the G20 Finance Ministers agreed on with regard to the Pittsburgh Summit, when they met in London at the beginning of this month, was the need, for the time being, to maintain the temporary support measures, without ignoring the need to start developing a coordinated exit strategy. I will come back to this briefly at the end of my speech.
The first two G20 summits in Washington and London were also decisive in terms of setting a global agenda for reforms in the systems of financial regulation and supervision. It may be said that we are witnessing a radical change in tone after nearly three decades dominated by the model of deregulation and theories on the alleged infallibility of the financial markets.
In Washington, the G20 countries established the foundations, laid down the principles and defined the agenda for subjecting the financial markets to stricter and more effective regulation and supervision, leaving no areas, products or financial players outside the control of the regulatory and supervisory authorities. These authorities must cooperate and coordinate their actions with one another much more closely in order to rectify the evident ineffectiveness of national supervisory systems vis-à-vis globalised markets and financial institutions operating across borders in these markets.
Extensive work was carried out at the London Summit in April to bring about concrete and significant progress in the implementation of this reform agenda. From prudential accounting rules, applicable to financial institutions, to the firm requirement for transparency in non-cooperative jurisdictions, namely tax havens, and including the regulation of hedge funds or other financial institutions, the organisation of transparent derivative markets, and the adoption of rules on the pay of senior executives of financial institutions and traders operating on the markets, the London G20 Summit took definitive steps towards fulfilling the promise of reform.
As a result, the European Union has performed a very important task not only in promoting these agreements at G20 level, but also in applying these G20 agreements. This has involved intensive regulatory work over the last year. Some of these proposals have already been adopted here in this Parliament and by the Council. Others are currently being discussed in this House and by the Council and, by the end of the year, the Commission plans to adopt another series of proposals, starting next week, one day before the Pittsburgh Summit, with the proposal to create the European Systemic Risk Board and three European micro-supervisory authorities, based on the recommendations of the de Larosière report, which both the Council and the Commission have taken on board.
The US administration has also revealed an ambitious financial reform plan, which President Obama confirmed this week as a priority of his term of office. He has recognised the responsibility of the United States as being the place where this crisis was born and developed.
The objectives set for the Pittsburgh Summit include checking on the positive progress of these reforms and ensuring the necessary regulatory convergence on both sides of the Atlantic. Any regulatory divergence will or could be used in the future by investors for arbitration strategies, which could once again create major distortions in the markets. However, in addition to ensuring compliance with what has already been agreed and encouraging the implementation of the measures adopted, the Pittsburgh Summit must send out a clear political message. The absolute desire of governments, political leaders, institutions, our own countries and the European Union to establish a solid regulatory framework with a firm commitment and dissuasive message must now be made clear. This message must say that 'no one should think that, having got over the worst part of this crisis, those former practices which led to the crisis can be allowed to redevelop, as if nothing had happened'.
The public expect guarantees that the financial institutions and their executives will be required to comply with rules, particularly on pay, which will prevent them from once again endangering the financial system and the real economy as a whole. It must be said that the European Union is totally united on this point.
Another issue that has been high up on the agenda of the various G20 summits is the reform of the international financial institutions, as already mentioned by Mrs Malmström.
The only point I wish to add is that an extremely important step forward was taken in London in terms of the financial capacity of these institutions, particularly the International Monetary Fund (IMF). Its lending capacity has been increased by no less than USD 500 billion, as a result of which the total funds now available to the IMF for its operations are USD 750 billion. In addition to that, it was agreed to distribute between all the IMF's member countries, in proportion to their quota, special drawing rights amounting to USD 250 billion. On top of that, it was also agreed to increase the IMF's financial capacity in order to boost its concessionary loans to the poorest countries. All that is already in hand. A great deal more progress has been made in the space of six months than over many years before that.
As a result, the European Union has, of course, agreed to duly contribute to this increase in the IMF's funds. The Member States of the European Union have agreed to add EUR 125 billion to their usual contributions, in proportion to the financing of the new objectives.
The G20 leaders will also discuss changing the representation of the various countries on the governing bodies of the international financial institutions. Emerging and developing countries quite rightly aspire to a more appropriate representation. This is an aspiration that the European Union supports, but it must be translated into concrete agreements. That is why the European Commission - although this is not the official position of the Presidency of the European Union - continues to say that, in line with what this Parliament has thought to date, the best representation for the European Union on these bodies is a single representation.
The Pittsburgh Summit agenda will also cover other issues: financing of climate change, in preparation for the Copenhagen Summit; the need to resume international trade negotiations and not to give in to protectionist tendencies; and increased support for the weakest and most vulnerable countries in tackling this crisis. As you know, the Commission adopted a communication on the financing of climate change last week.
Finally, please allow me to conclude by mentioning the wish expressed at the last meeting of the G20 Finance Ministers, and which will be discussed at the Pittsburgh Summit: the need to establish the foundations of a future model of more balanced and sustainable growth. This will firstly involve developing exit strategies, not to be applied immediately, but to be applied when appropriate and in a coordinated manner. This is because the development of such strategies is not only key to a sustainable exit from this crisis, but also to offering, at the same time, a prospect of medium-to-long-term sustainability following the profound effect that the crisis has had on public finances, on levels of employment and on the capacity for growth of our economies.
Corien Wortmann-Kool
Mr President, Minister Malmström, Commissioner Almunia, we are in a global crisis. We have a financial sector that operates on a global basis and we therefore need, as far as possible, to agree binding rules for the sector on a global basis. That is why the G20 in Pittsburgh is so important, though the European Union itself should, of course, take vigorous action. Efforts must be focussed on restoring the balance between freedom and responsibility, the values that form the basis of our social market economy, the core of our electoral platform in the Group of the European People's Party (Christian Democrats).
Mr President, the G20 Summit is an important summit where it is more than vision that will be needed - I am happy that you have said so too. It is a summit where decisions have to be taken. This relates to structural reformation in risk management, more transparency and better rules for financial supervision. Commissioner Almunia, you said that there are proposals in place for hedge funds. What do you hope to achieve in this regard at the G20 Summit? A rapid reform of the IMF and the World Bank is also very much needed, and - I am pleased that you have both said this too - there must be timely work on a coordinated exit strategy, or new problems will arise once again.
Mr President, it is of the greatest importance that the flawed bonus culture be tackled with binding rules, as bonuses that reward short-term profits pose a great risk to the stability of financial institutions. That is not all, however, as there is rightly a great deal of public indignation and, for that reason, too, it is very important that we show ourselves to be decisive in this regard.
Mr President, the summit will only be a success if binding agreements are reached. I have talked about financial regulation, but climate change, preparing for a successful Copenhagen Summit and fighting protectionism in the interests of jobs are, of course, very important issues. You, the European Union, all of us together, must play a pioneering role in this regard, and it is therefore important that you get the Member States to pull together.
Udo Bullmann
Mr President, President-in-Office of the Council, Commissioner, ladies and gentlemen, first and foremost, there can be no 'as you were' in the current economic situation. That will only allow us to make a slow recovery and we shall see a further dramatic increase in unemployment figures, including here in Europe. You must therefore be bold. That is the most important message this Parliament can give the Pittsburgh delegates. Be bold!
Mr Almunia, I have listened to a refreshing speech from you, on which I should like to congratulate you. Now you need to start putting it into practice. It is good to start with the bonus systems, but it is not enough. We need a gear shift wherever short-term speculators are at an advantage on the international financial market, because the rules are wrong, over those who wish to make long-term investments in jobs, in products of excellence and in the long-term success of their company. It is right to say that no risky players, no risky financial centre can remain without reasonable regulation, which is why we need regulation of the offshore centres from which dubious products are flooding the entire world. That is the most important task that we must now set ourselves.
Nor should you be frightened of discussing fiscal policy - it is not prohibited. A global transaction tax which benefits long-term investors would take us forward in this discussion as a whole. We need strong, improved coordination of our international, as well as our European, economic policy. It is right to think about an exit strategy, but it is even more important at the moment that we work out how we can give more solid support to the economy and improve the coordination of our economic policy.
Sylvie Goulard
Mr President, Minister, Commissioner, we clearly appreciate all the efforts that you have mentioned and which have, in fact, already gone quite far, but we want more. We want a number of the G20's elements and commitments to be formalised. In particular, I would like to draw your attention to the gap between the rather encouraging figures in the financial sector and the terrible unemployment figures in the European Union. If we have long-term unemployment, we will have, firstly, a human tragedy, and also a burden on public finance and no hope of a recovery through consumption.
We, the Group of the Alliance of Liberals and Democrats for Europe, very much fear a Japanese scenario and a sort of sluggish growth for several years. I think that your country, Mrs Malmström, Sweden, has unfortunately also had experience of this. Please help us to take advantage of this experience.
For me, there are three essential tasks. Firstly, we have to carry on cooperating internationally, and carry on fighting against protectionism and strengthening global institutions such as the IMF. We cannot get out of this on our own. Europe must hammer home this message tirelessly.
Secondly, we must successfully put in place effective supervision and a much more demanding form of bank stabilisation. In this respect, we should be wary of the G20's publicity stunts. There are executive powers, but there is work to be done at a legislative level and, for us, Mr Almunia, the Commission's proposals on supervision are a step in the right direction, but they are not enough. Ultimately, we want more European entities. Then I think we will have to consider joint strategies for exiting the crisis while preserving the euro, making sure that the deficits do not place a strain on common monetary discipline.
To conclude, I would like to thank Commissioner Almunia for saying that he was in favour of the European Union as a body adopting positions in international institutions, thus defending the Community method. We are counting on you to make sure that it is not only the large States that make their voices heard, but that the whole of the European Union and the whole of the internal market are defended.
Sven Giegold
on behalf of the Verts/ALE Group. - Mr President, I thank the Commissioner for his speech. I have several concerns. The first is that the Committee on Development in this House drafted a motion for a resolution. I quote from that. It 'notes with great concern that the crisis already bears major human costs, and has devastating effects for the vulnerable in the poorest countries with an expected increase of 23 million more unemployed, up to 90 million more extreme poor in 2009 alone, life-saving drug treatment for up to 1.7 million people under threat, and 200 000-400 000 more infant deaths per year on average between 2009 and 2015'.
Unfortunately, this motion was not passed, although it was written together by all groups of this House. We strongly deplore and we think it is a shame that this House was not able to draft a resolution on the G20 on development issues.
The big question is how to finance the consequences of the crisis, and there the German Minister of Finance, together with the Chancellor, suggested that the G20 discuss the possibility of a global transaction tax. I ask the Commission, and I also ask the Presidency of the Council. Do you support this proposal?
The second question is about tax havens. The G20 wants to tackle it on the basis of case-by-case information exchange. We know that this will not work. The Development Committee suggested a country-by-country reporting regime so that transnational corporations have to report back on a country-by-country basis. We suggest introducing automatic information exchange so that information really flows between the different countries.
A global financial system needs transparency. We also want to know your position on these concrete proposals to get out of the crisis and finance the consequences.
Kay Swinburne
on behalf of the ECR Group. - Mr President, thank you for the speeches we have had this morning. I was particularly pleased to hear Mrs Malmström's comments about the G20 Pittsburgh representatives needing to agree to significant coordination in the continued support of stimulus measures, in the unwinding of these support measures when appropriate, and a determined coordinated effort on future regulation.
However, the backdrop to this summit is nations spending trillions of dollars on bailouts and stimulus packages and in two of the largest world economies we are seeing some protectionist measures, particularly with regard to tyres and poultry, as well as two of the most complicated regulatory structures in the world, namely the EU and the US, looking to completely overhaul their financial systems. Therefore, I hope that the important issues of how to coordinate financial services, particularly now that some countries are showing early signs of coming out of this period of negative growth, will be the main topic of discussion and not the distraction of controlling bankers' bonuses.
This summit should focus on how we achieve a common regulatory framework in a common timescale so that we do not create an opportunity for competitive advantage by individual nations or regulatory arbitrage opportunity for speculative trading. There will be no first-mover advantage in financial regulation. A global, coordinated approach is the only one which would benefit the businesses looking to raise funds in Wales, the EU and beyond.
If my Welsh businesses cannot access funds from the US, if the banks they rely on will require so much capital that the taxpayers of the EU need to take even more risk, we will not be thanked for moving first on overly burdensome regulation. My plea is that a global, coordinated approach is adopted at all times and maintained to ensure the future access to capital for all our businesses in Wales, the EU and beyond.
Miguel Portas
In Portugal, bank profits grew by 18% in the first quarter of this year. The only thing that rose more than bank profits was unemployment. Portugal is not an exception, but an example of an unfulfilled promise made by the G20, which was that we would resolve this crisis with a new economic and world order.
That is not true, and 50 million more people out of work and 200 million more people in poverty prove that it is not so. That is why I call on the Commission and Mrs Malmström to deal with bonuses and hedge funds, certainly, but most of all to deal with what we have not mentioned here: the end of off-shore banking, tax havens, the tax on financial transactions and the end of banking secrecy. They should do anything that can be seen if they want people to believe in them.
Mario Borghezio
Mr President, ladies and gentlemen, how can the people have faith in financial market regulation when it is entrusted to the high priests of the global financial temples such as Mario Draghi?
In the United States, a popular uprising, a new conservative revolution of the people against the financial oligarchies, is taking place. We the people do not believe in making taxpayers fund policies to rescue the financial powers, whether in the United States or in Europe. Rather, European governments should give adequate resources to the real economy; they should worry about production and jobs. We can see the results of the G20: they include nothing about ceilings and bonuses, nothing about the elimination of tax havens!
The measures are instead aimed solely at rescuing those responsible for the financial bubble: EUR 23 trillion have already been spent, EUR 5 trillion of which were spent by the European Central Bank. The money in our economy has been gifted to those responsible for the financial bubble. In comparison with the EUR 850 billion given to the banks, only EUR 50 billion has been earmarked for welfare support provisions and production incentives. The reality is that high finance gives the orders and politics obeys them.
In the United States as in Europe, politicians appear merely as servants of the global banking power. Wake up, Europe! Follow the example of the US population, which is starting a second major revolution: the conservative people's revolution!
Hans-Peter Martin
(DE) Mr President, we need democratic revolution. That is clear from this process, which has luckily gained momentum with what is presently the G20, because more may join; one could even imagine a G3. How would it be if the Council helped in establishing a democratic control mechanism, especially given its tradition of consensus? It need not be a world parliament straight away, but what is being promoted needs democratic scrutiny by elected parliamentarians within a far bigger forum than the European Parliament.
I should also like to specifically point out that the question of systemic risks must be approached at its core. With reference in particular to the tiresome situation we keep finding ourselves in, starting back in 1998, with LTCM, Hypo Real Estate and, of course, Lehman, and the knock-on effects, rules should emerge from this that make it impossible to end up with the basic problem of 'too big to fail'. This can, of course, be done through cartel legislation, but it is certainly also a fundamental global question.
As far as a global transaction tax is concerned, the Tobin tax group was set up here in the European Parliament back in 1999. It is good that there has been progress here. As far as the supervisory package is concerned, we urgently need to act on a European scale and not to allow ourselves to be held back by those who want the wrong Europe.
Othmar Karas
(DE) Mr President, ladies and gentlemen, the statistics are improving. However, the multiple causes of the crisis - and it is not just a question of loopholes in regulations - are far from being removed. For that, political will, decisiveness and courage must not fail us; on the contrary.
Today we are talking about the G20. It is a good process. We need new or different structures, priorities and bases for valuation in order to build up a global economy and a financial, social and judicial order in the world.
There are three conditions for this: firstly, we need to develop a democratic, parliamentary legitimisation process; secondly, we need more EU in Europe and more Europe in the world, which also means that the values of our Charter of Fundamental Rights are our export articles, that our model of a responsible eco-social market economy is the basis for our global order and, thirdly, European regulation is needed in areas in which no agreement is in sight within the framework of the G20.
We say yes to integrated European rather than simply coordinated financial market supervision on the basis of the model of the European Central Bank. The de Larosière report is too little. We say yes to the debate on bonus payments, but changing the payment methods is not the right way to go about it. We must change the basis for assessment and, wherever there is a bonus, it must also have a penalty component.
As far as I am concerned, the debate on pro-cyclicity is too brief at the moment. We need to remove the procyclic effects of the crisis and the current regulations for 2009 and 2010. The political will must not fail us. That is why, following the speeches of the President-in-Office of the Council and the Commissioner, we are going to Pittsburgh with optimism.
Pervenche Berès
(FR) Mr President, President-in-Office of the Council, Commissioner, one year on from the collapse of Lehman Brothers, the position that the European Union adopts at the G20 Summit in Pittsburgh is absolutely critical if we want to prevent a repeat of past events and want the dynamic of change to remain at the top of the agenda. I have four observations on this matter.
Firstly, at the G20 Summit in London last April, the Heads of State or Government made a commitment to increase the IMF's funds. Very well. We have seen that there was significant support to fulfil this objective. I fear that behind this there has been less determination to play a part in the much-needed reform of the governance of the IMF.
My second observation is that we must not fall for gimmicks. I would not like the omnipresent debate on the bonuses and salaries of both CEOs and traders - which is absolutely critical if we want to develop the system into one which focuses less on the short term and more on long-term investment - to overshadow what is an equally important campaign concerning the eradication of tax havens, which was the highlight of the London Summit.
My third observation - and this picks up on what Mr Bullmann said earlier - is that this is an historic moment for us to raise the question again of the banks' contribution to financing the aftershocks of the crisis. This will enable us to reopen the debate on the taxation of transactions, which itself must also allow funds to be made available for long-term investment. Once again, given the way the banks have been supported and assisted to cope with this crisis, the only right, proper and effective course of action is for them to contribute today to the financing of the economy.
My final observation is that, when we look at the employment picture, I think that from the start, our G20 meetings have fallen short when it comes to tackling the macroeconomic question, the question of a global pact for employment, and the question of a return to a strategy which, tomorrow, will enable us to correct the global imbalances that caused this crisis.
Wolf Klinz
(DE) Mr President, ladies and gentlemen, I welcome the fast and decisive reaction of the G20 to the global financial crisis. A great deal has happened. The fire appears to have been put out, but the foundations of our financial system are still shaky. The citizens are unsettled. Profits are being ploughed back for the benefit of shareholders and losses are being socialised, that is how the citizens see it. In the meantime, it is back to business as usual for more and more market players, who are making big moves, rather than focusing on what they should really be doing as service providers, namely supporting the real economy. Financial ethics and responsibility appear, as ever, to be foreign words to many of them.
I am expecting specific - and fast - measures from the G20. I hope that the EU Member States will all pull together. In addition to new supervisory structures, we also need bigger equity bases, which increase in line with the risk, long-term - not short-term - incentive systems, a coordinated exit strategy from State aid, contained protectionism, congruent regulation, rather than regulation arbitrage, an end to pro-cyclicity and a solution to the 'too big to fail' problem and, above all, we must abide by the tried and tested social market economy.
Cornelis de Jong
Mr President, so far the G20 has concentrated on measures for the financial sector. However, everyone seems to forget that the real economy also suffers from greed and an obsession with short-term profits.
I have deep respect for small enterprises which, against all odds, try to survive. They deserve to get the loans to which they are entitled. However, I have no respect at all for the management of some of the bigger companies which have no affinity with the products or services they deliver and can only think in terms of expansion and speculation.
I therefore call upon the G20 to discuss ways of making the economy more democratic and how to make sure that, within the company, workers and others who represent the general interest have enough power to control the management.
Within the EU, we have to look again at the statute for a European company. We should make sure that it becomes impossible for shareholders and management to engage in speculative growth strategies to the detriment of the long-term interest of the companies themselves and of those who work for these companies.
Krisztina Morvai
Mr President, the majority of Europeans are not corporate leaders and not bankers but family farmers, small entrepreneurs, state employees.
The majority of Europe is completely fed up with the present system, in which global multinational corporations and banks rule the world. They need, and they want, a fundamentally new paradigm, in which there must be a shift from globalisation to localisation, from completely profit- and money-centred decision making to human-centred and community-centred decision making, from WTO-ruled free trade agriculture to food sovereignty, local production and local farming.
Please do not fail to represent at the G20 Summit the views of the majority of Europe.
Werner Langen
(DE) Mr President, ladies and gentlemen, who should regulate whom and how? That will be one of the controversial questions at the G20 Summit. Even if there is unanimity on the fact that there can be no return to unbridled developments on the financial market, the methods and extent of regulation are still the subject of fierce argument. It will still be possible to reach agreement on equity rules, on rating agencies, possibly even on questions in connection with derivates and their licensing, but there will be argument on the question of unfair competition, taxes and control. There will be arguments over bonuses and there will be arguments over Europe's demand for a Tobin tax.
In other words, as Europeans we have a responsibility to do our own homework, regardless of the outcome of the G20 Summit and the Commission is on the right path by not relying solely on it. The motto must be: no financial market players, no financial products and no financial centre with no supervision in future.
However, global economic recovery is also on the agenda. We cannot carry on here as in the past and maintain the imbalances in the world for the benefit of the US and for the benefit of the large industrial countries. We must devote ourselves to overcoming poverty and hunger in the world and the G20 Summit must give new momentum to this.
I should like to add one point that no one, with the exception of Commissioner Almunia, has addressed so far. It will be necessary to abide by the Stability and Growth Pact in Europe, not to bury it. It is only because we had this pact, because we revised and maintained it, that it was at all possible for Europe to remain capable of action. This should remain a European objective: a fast exit strategy out of excessive debt into a stable economy, to the Stability and Growth Pact as we know it.
Edward Scicluna
(MT) Mr President, currently, one of the most popular topics, at least on the news tied to the G20 Summit, is that of bonuses. It is evidently a much talked about issue, yet we have to understand that the actual problem is rather more complex. What has to be said is that if these bonuses are to put the financial system at risk then, undoubtedly, they must be checked. However, we must keep in mind that there were large deficits in the external trade between countries that led to this crisis, as well as other internal fiscal deficits.
We must also take employment into consideration. We know that the employment lag approximately requires about a year or so to catch up with the impact of previous GDP performance. Therefore, when analysing employment issues, fiscal stimulus packages that are applied must keep being applied until positive results begin to emerge. The Commission should ensure that there are no inconsistencies and should require that a reduction in deficit be registered before doing so.
Kyriacos Triantaphyllides
(EL) Mr President, the G20 Summit, the main topic at which was bonus management, does not by any stretch of the imagination get to the root of the problem and, unfortunately, is not a step towards improving the present system.
The series of proposals to amend the regulations is confined to an analysis of superficial issues and does not focus on social objectives. The objective should be a total overhaul of the financial system and public and social control, a more democratic summit which would include all states and would address issues such as increased unemployment and the spiralling cost of basic goods and fuel, a summit which would take fundamental decisions to intervene in the market in order to put a stop to continual privatisation and the destruction of the social state.
These are the people's real needs. Citizens today want overall structural change, far from a neo-liberal system which leads to under-development instead of development, far from the rampant speculation which works against the people's interests.
Jean-Paul Gauzès
(FR) Mr President, Commissioner, I welcome your determination.
Europe has begun to put in place effective regulation, but Europe must not find itself isolated. Close international cooperation is necessary, and this is exactly what we expect of the G20. It must pursue the reforms, which were initiated at previous meetings, with rigour and vigour. The international framework for regulating the financial sector must be completed, so that it can aid investment, growth and employment. Guiding principles must be affirmed. The crisis is not over. We must not return to the situation ex ante and abandon measures needed to avoid, as far as possible, the renewal of crises which are particularly damaging to the real economy, growth and employment.
The strengthening of supervision and regulation is equally necessary. The obligations for supervision should reflect the level of systematic risk that the financial institutions impose on this sector. Speculative activities, which represent a significant risk, should be discouraged by increasing the capital requirements and applying the Basel rules internationally.
As for salaries in the financial sector, we should recommend pay committees, increase transparency of these salaries with stricter disclosure requirements and supervise variable salaries, notably bonuses. The strengthening of global financial institutions is likewise an imperative, as is the reform of governance and representation at the IMF.
Commissioner, these are some of the expectations citizens have of the next G20, where Europe must speak with one voice, with determination and conviction.
Alejandro Cercas
(ES) Commissioner Almunia, Mrs Malmström, I would ask you not to forget in Pittsburgh that we are experiencing not only a financial and economic crisis of unprecedented dimensions, but also a huge social crisis with devastating effects on those most in need, on those who only have their job, on small entrepreneurs, and on the most disadvantaged regions and countries. I hope it is made clear in Pittsburgh that the economy is important, but that people are more important and that the economy serves the people.
Furthermore, Commissioner, Minister, please do not forget in Pittsburgh that Europe exists. Please make your voices heard above those of the three tenors. I have here the letter of 3 September from the three European Prime Ministers. There is not one word on Europe. They say that it is important that Europe speaks with one voice, but they keep drowning out Europe's voice.
You must speak louder than them. You must make clear that Europe has a right and an obligation, and that our vision of the social market economy is the solution to this crisis, and to preventing its reoccurrence.
José Manuel García-Margallo y Marfil
(ES) Ladies and gentlemen, I agree with many of the points that have been made, but must qualify some others.
I agree that it is too soon to take away the patient's crutches, but that it is time to get him ready to walk without them. We still have to absorb excess liquidity in the markets, correct the imbalance in public finances and re-establish respect for competition rules. In Pittsburgh we must do several things that we cannot do alone: we have to set up early warning mechanisms that work, because those that we had did not work; we have to revise the regulatory framework, because the existing framework has not worked.
I agree that it is important to regulate bonuses and tax havens. These are all necessary, but inadequate, measures. In my opinion, it is more important to re-build the muscle of financial institutions, limit debt and set up reserves in good times so that we can weather the bad times. It is more important to make an effort in terms of supervision.
The Commissioner knows that I supported the de Larosière report, although I felt it was inadequate, because I would support more centralised supervision. However, it is clear that European supervision cannot function without close coordination with the supervisory authorities of the other major economic areas of the world. We also need to do something about trade. It is all well and good helping the emerging countries, but it is more important to lift the barriers that are still preventing trade in goods.
Commissioner, the most important point is that we need to establish the foundations for stable and sustained growth over a generation. For this we need free markets, markets open to innovation, markets open to entrepreneurs, but also markets subject to a certain level of regulation.
I will end with a quotation, which will be familiar to my compatriot Mr Almunia: 'Publish not many edicts; when you do enact pragmatics and decrees, see that they be good ones and, above all, that they are well observed', so said Don Quixote to his friend Sancho.
Peter Skinner
Mr President, I thank the Commissioner. I especially agree with him on his Charter for Sustainable Economic Activity. I think this is what we must take to the G20 but I do not agree that we should use all our capital to focus on bankers' bonuses. I think this is a distraction in many ways although it should be dealt with. Neither is a wish list for solving the world's problems frankly likely to win the day.
The financial services industry is on fire. We need first to make sure that we have put out that fire and that it stays out. For this we need a consistent approach. The G20 is a leading forum, but we also need permanent structures in place as well like the Transatlantic Economic Council to deal with issues like IFRS. If systemic risk is to be truly dealt with, we need to stop looking in the rear-view mirror and start focusing on the road ahead.
Kader Arif
(FR) Mr President, ladies and gentlemen, the crisis that we are going through is profound and long lasting. It is therefore urgent and absolutely essential to put in place the necessary regulations and supervision of the financial sector and the banks, to prevent an even more drastic repeat of today's crisis. The financial system must once again serve the real economy and not continue to destroy it.
From this point of view, the last G20 Summit in London, which has been mentioned, ended in what were, to say the least, partial proposals, but, above all, the words have not been turned into deeds, and the financial drift is there once again.
In view of this situation, and so that the Pittsburgh G20 Summit really is useful, the European Union must defend strong regulatory measures that have real consequences. Beyond the essential measures to supervise finance listed by a number of my fellow Members, I personally would like to raise the issues of trade and development, because in Pittsburgh there will also be talk of relaunching the Doha Round. Relaunch it, yes, but with the condition that the initial and central objective of this Round, that is to say development, is not sidelined again. Our southern partners, quite rightly, will not accept that their concerns continue to remain unanswered.
The issue at stake in this G20 goes beyond that of the financial crisis: it is about laying the foundations of new global governance.
Ramon Jauregui Atondo
(ES) Mrs Malmström, Mr Almunia, I will give you three ideas in one minute.
Firstly, we need more Europe. This is because, given the global situation, Europe must be united and strong. If we fail to achieve this, Europe will not count and will not be involved.
Secondly, we need more State. This is because, in addition to developing a new governance for the world, in addition to new regulation and supervision, and also greater international coordination, we need to put an end to tax havens and review transnational taxation. This, in my opinion, is an urgent issue for the future.
Finally, we need a better market. I feel it is vital to reiterate the need for new business ethics and also the need to encourage a new culture of corporate responsibility. I believe this is essential. Companies must become part of society and, as such, must be held liable to these interest groups and to these stakeholders.
Rachida Dati
(FR) Mr President, Minister, Mr Almunia, first of all, on 3 September, Germany, the United Kingdom and France reached an agreement, spoke with one voice to express a European consensus on the matter of the supervision of traders' bonuses.
On Thursday, the 27 members of the Council will meet to prepare for the G20. I encourage you to work actively to find a solution, a common response, but one that is especially ambitious as regards the matter of traders' salaries. Indeed, the rules enacted and the decisions taken at the last G20, in April, have not been respected, as the banks, which had also received State aid, swiftly set aside sums to pay traders.
European citizens cannot and would not understand why such breaches have not been punished, when measures were taken at the time of the G20 Summit. When it is a matter of State aid, breaches absolutely must be punished. It is therefore essential that concrete and, above all, joint measures be adopted at Pittsburgh. We cannot be the only virtuous ones.
In short, salaries must be better supervised through rules of transparency, governance and responsibility, and penalties must be applied where these rules are breached.
Monika Flašíková Beňová
(SK) In my opinion, what you have presented here is a rather ambitious plan, which you want to present to the G20. I am concerned, however, as to what the conclusions of the G20 will be and what the real effects will be on society, since the results that have filtered through at the level of EU Member States are so far neither tangible nor visible.
Mrs Malmström was saying that the issue is one of proportionate levels of pay for managers, but it must be said that all of the data indicates that it is precisely in those sectors which we supported financially and which we protected from ruin that managers receive disproportionate levels of pay. In addition, nothing has happened with offshore banking - the mechanism has simply not been brought into play.
All of this leads to mounting unemployment and problems for small and medium-sized enterprises and, in my opinion, we should perhaps focus on fewer issues in the future while ensuring that those issues we do focus on are implemented in full.
Pascal Canfin
(FR) Mr President, you spoke of the governance of the IMF. I would also like to know if you intend to raise the issue, at the G20, of the conditionality of the money that the IMF lends to states. We have seen that what were previously very liberal conditions have not been changed, and this applies in particular to the loans that were granted to some European States. What is your position on this?
My second question is: what is the position of the Commission and the Council on the Chinese proposal to put in place a slightly different international currency, in an effort to regulate the financial system using an alternative to the dollar?
My third question is: the G20 is also part of the preparations for Copenhagen. The Commission has proposed a total sum of between EUR 2 and 15 billion to help the countries of the South adapt to climate change. What is the Council's position? What sum will you put on the table at the G20 next week?
Vicky Ford
Mr President, the G20 came up with many sensible responses: the need to rewrite financial regulation and supervision, and the need to act in a coordinated fashion. Our national politicians are saying one thing, but here in the EU we seem to be doing another. The detail of the regulation that is already being considered by some of my colleagues shows divergence both in the timetable of implementation and in the detail of the regulation.
Our economies are still very fragile. Unemployment is rising, and access to finance is a huge concern, especially for small and medium-sized businesses. Do we want our British or European businesses to be at a competitive disadvantage when they need working capital? Do we want to make it so expensive to borrow from a European bank that our customers, our corporates, just go and borrow from Wall Street and end up handing another coup to Wall Street at the expense of European banks?
(The President cut off the speaker)
Enikő Győri
(HU) Ladies and gentlemen, allow me to approach this subject from one of the perversities of the crisis. Hungary's citizens were shocked that, while the country is currently subsisting on aid from the IMF and EU, following seven years of socialist government, Hungarian banks' half-year profits reached two-thirds of their pre-crisis level. The banks are also able to amend unilaterally their agreements, thereby putting in a vulnerable position citizens who have taken out foreign currency loans in the hope of buying their own flat.
I firmly believe that we must take action against such trends. We should subject the banks and other financial market operators to proper supervision. We should prevent the continuation of the damaging bonus culture prevalent before the crisis. We should set in stone rules of professional ethics because we have seen where we end up with excessive deregulation. Let us create a world which gives rewards, not for making a quick, short-term profit and immoderation, but for proper work, and which regards social responsibility as a basic value. We must work together on sensible rules to win over our G20 partners.
Csaba Sándor Tabajdi
(HU) There is a clear message from what has been said so far, namely, that in order to regain the trust of ordinary citizens, we must take action against bonuses and tax havens. I would like to ask Commissioner Almunia and Mrs Malmström about when the European financial supervisory authority proposed by the Hungarian Prime Minister will come into operation. I would also like to point out that it would be an extremely important task for this Parliament, nothing to do with G20, to protect the interests of European consumers and citizens.
They are completely at the mercy of the banks, which do not provide sufficient reliable information. A code of ethics has been drawn up in Hungary. I would suggest a code of ethics in Europe at EU level, governing the behaviour of citizens and banks, because I strongly believe that there are a huge number of innocent victims as ordinary citizens do not understand the risk entailed when obtaining credit. This is an extremely important task for Europe.
Corinne Lepage
(FR) Mr President, Minister, Commissioner, the very ambitious programme you have presented to us is interesting, but do you not think that we ought to tackle the issue of the advantage that is still to be gained, today, by favouring very short-term transactions and very short-term profitability over the medium and long term?
The lack of funding for our businesses, particularly in Europe, is precisely due to the advantage that is still to be gained by very short-term investments. Do you not think we should tackle this issue?
Cecilia Malmström
Mr President, I would like to thank all the Members who have contributed to this debate. I feel there is a very high level of agreement in this House about what is important in the European position and which issues we must concentrate on ahead of the G20. The EU now speaks with a clear, coordinated voice on the international stage and I really would like to thank the Commission and, in particular, Joaquín Almunia, for the work that he has done to help bring about this consensus.
Many Members have raised the issues that both I and the Commissioner have looked at. Yes, we need better supervision and better regulation of the financial markets. We hope that a supervisory system can be put in place as soon as possible. We will base this on the Larosière report and see how quickly we can get it into place. We need more coordinated global solutions and effective and functioning international institutions. We need clear principles for bonus systems. I have great faith in the Financial Stability Board and I am confident that it will come up with specific realisable proposals that we can discuss.
We would also like to take up the matter of climate financing. We will call upon all countries to shoulder their responsibilities, but I am not sure that it is realistic to expect to be able to discuss figures at the summit in Pittsburgh. Naturally, we will work towards this, because it would be a good thing.
We also need global solutions. We cannot separate EU solutions from this system, but instead must ensure that we get as many global solutions in place as possible. Unemployment is perhaps the most noticeable aspect of the economic and financial crisis to the people of Europe. Unemployment is here to stay for some time in most of our countries and that is a very, very serious situation. It calls for European and national solutions. We must have a strong labour market policy, we must make it easier for companies and entrepreneurs to take the risk of employing people and to dare to invest and we must ensure that people are employable by investing in education and research. We will be having a special discussion on unemployment at Ecofin in October.
We also have to discuss exit strategies. Otherwise, there is a risk that the measures that we have taken will have negative effects on unemployment and growth in particular, and will result in deficits and inflation. It is always the most vulnerable in our society who suffer first. When it comes to the poorest countries, we are very, very aware that it is they who are the biggest losers in the international crisis. It is hitting the poorest in the world hard. We have discussed and are continuing to discuss how we can ease the situation of these people. It is important that the Multilateral Development Banks (MDBs) have sufficient resources to be able to provide what are known as soft loans. It is also important that we ensure that the international trading system works properly and that there is no protectionism inherent in it. Consequently, the various discussions concerning global taxes and various kinds of Tobin tax are only meaningful if they can actually be realised globally, and at the moment that is not the case. As a result, they would only be counterproductive and would not help our economies.
Many Members have raised the matter of hedge funds and new financial regulation. These are priority issues for the Swedish Presidency. We will decide these matters alongside you and we look forward to working very closely with the European Parliament to get directives on hedge funds and financial regulation in place as soon as possible. I am aware that it is difficult and complex - that there are many aspects to take into consideration - but we are prepared to work with you as closely as possible to get this in place.
In summary, naturally the G20 Summit cannot solve all the problems that we have discussed. Nonetheless, I have good reason to hope that we can make substantial progress on the issues that we have discussed. There is pressure from the citizens of Europe, but there are also people around the world who expect us to demonstrate our leadership and increase the stability of the financial systems, to do our utmost to avoid this type of crisis in the future and ensure that we come out of this crisis stronger than we went into it. The EU is united, the EU is strong, and I can assure you that the Swedish Presidency will do its utmost to defend and assert the views of Europe at the G20 Summit next week. Thank you very much for a highly interesting debate.
Joaquín Almunia
Mr President, I believe we are all agreed that, in the current situation in which we still have to tackle huge and extensive challenges as a result of the crisis, the success of the G20 Pittsburgh Summit and the belief that, as a result of these meetings, we will start to find and apply solutions to the problems and challenges facing us, are extraordinarily important. We are, in fact, starting to see some significant signs of improvement in certain economic indicators, particularly in the growth of international trade and in the confidence of consumers and investors. As a result, all the items on the summit's agenda should be, must be and I hope will be agreed by the Heads of State or Government and implemented following the meeting next week.
One of the most important points, mentioned by many of you, is the need for clarification, for a clear message as to how the world's major economies intend to keep coordinating their actions. The next step in the coordination of economic policy must be to define an exit strategy and commit to a decision as to when and how this strategy will be applied in a coordinated manner. We must learn - and I believe we have learnt - the lesson from the crisis of the twenty-ninth that the stimulus measures cannot be withdrawn too quickly, when the economy - as some of you have said - still needs crutches. However, we must also not use these stimulus measures for longer than necessary because, in that case, we would be repeating the conditions that led to the bubbles and imbalances which were the cause of this crisis. This is a very important issue, which must be clarified by the Pittsburgh Summit.
We must avoid repeating the errors of the past, not only in terms of macroeconomic policies, but also in terms of financial regulation and supervision. I believe that this commitment has been made very clear at previous summits. We must keep developing this commitment and honour those undertakings already made at both global level and, as in our case, at European level.
In this respect, I agree with those who have said in this morning's debate that not everything should be reduced to the issue of pay. However, I also fully agree with those who say that the issue of pay is extremely important in economic, social, political and ethical terms. I believe that Europe is showing its leadership on this issue - as it has done on other issues on the G20 agenda - both through each of the Heads of State or Government and also through the European institutions themselves, the Presidency of the European Union and the Commission.
We should not forget that, in April of this year, the European Commission presented the Member States with recommendations on pay, which are almost exactly the same as those that the whole world is now proposing. We must continue to pay attention to the problems of the financial system - more capital, restructuring and correction of bank balance sheets - at both the European and global levels.
When you have a fully interconnected financial system, there is no point in us solving our problems within our borders if no one else is solving their problems at the same time. You must remember how, one year ago, on the day before the Lehman Brothers crisis, we still thought that we could avoid the worst problems of the financial crisis created in the United States. At the same time, it is absolutely true, as many of you have said, that, in the end, the political objective is not just to sort out the balance sheet of one bank or capitalise its liabilities. The fundamental problems are employment, the situation of our small and medium-sized enterprises, and the sustainability of our public services and social welfare systems.
However, without a functioning financial system, nothing else can be sustained. That is the challenge that must be tackled by the Pittsburgh Summit, or which the G20 must continue tackling at the Pittsburgh Summit.
Finally, I should like to comment on an issue that was raised in many of your speeches. While I agree with other items on the G20 agenda, which many of you have mentioned, I want to refer to just one: the issue of tax havens and non-cooperative jurisdictions.
It is true that the G20 meeting in London failed to find solutions to all the problems posed by tax havens. It would be very difficult to find all the solutions in one day to a problem that has been around for many years. However, it is also absolutely true that, since the London Summit in April, many more problems have been solved over these six months than were or could have been solved over many years before the London Summit. On this particular point, agreement has been reached on the exchange of information needed to prevent tax avoidance and to prevent economic and financial activities being hidden from the public authorities by utilising the protection of tax havens. It is therefore true that not everything has been solved in these six months. However, in these six months, we have achieved a great deal on an issue which is very important in terms of preventing those financial activities, which are hidden from the regulatory and supervisory authorities, from once again creating distortions in the system. This is also extraordinarily important in terms of the message that we are sending to our citizens about the distribution of responsibility and the efforts needed to tackle this crisis.
Lastly, someone said that the EU's voice must be heard above the voices of the European members of the G20. I can assure you that, under the Swedish Presidency and using the voice of the European Commission, the EU's voice is being heard. It is being listened to very attentively and respectfully because Europe, and not just one or two European countries, but the European Union was the organisation that started this process of global coordination. This clearly shows that more effective results can be achieved when there is true coordination.
President
The debate is closed.
The vote will take place during the first October part-session.
Written statements (Rule 149)
András Gyürk
It is expected that the approaching G20 Summit will place a predominant emphasis on the Copenhagen climate talks. There are still many undecided questions standing in the way of a post-Kyoto agreement. Allow me to express a few thoughts I have on this subject. Number one. Instead of vague long-term promises, we need binding medium-term undertakings. These undertakings must be realistic, fair and accountable. When establishing these undertakings, apart from factors like economic development and natural assets, it is important also to take into consideration the extent to which the Kyoto commitments have been fulfilled so far.
Number two. Support should be given for the notion that the EU should assist the developing countries financially as well in achieving their climate policy objectives. A specific financial pledge is needed to achieve this. However, in order to ensure transparency, the developing countries must also make binding commitments and draw up detailed action plans.
Number three. Flexibility mechanisms must continue to be given an important role. In order to promote investment, agreement must be reached as quickly as possible on the way in which the certificates deriving from the projects carried out so far can be included.
Number four. Market-based instruments must be given more scope in the post-Kyoto system. For example, extending the emissions trading or green certificate schemes may help achieve a reduction in emissions in places incurring the minimum cost. I believe that the economic crisis is not an obstacle to the Copenhagen compromise. A decent medium-term agreement may somehow boost the European economy's competitiveness, while also reducing the burden on the environment.
Edit Herczog  
Five years ago, on their accession to the EU, every new Member State committed to adopting the euro. At present, four of them have already achieved this. The other countries have drifted and are lagging behind in this area due to various economic policy considerations and mistakes, not to mention that the economic and financial crisis has put them in a vulnerable position. The economic downturn has fuelled protectionist ambitions, which threatens to undermine the operation of the single market.
The current economic crisis has highlighted the fact that the euro has assumed a prominent role in the close economic ties established with the euro area members, but the States hoping to adopt the euro have now ended up in an extremely vulnerable position due to the protracted preparations. Many believe, myself included, that in the critical currency situation that has evolved, the key to the solution would be to speed up the introduction of the euro for these Member States. However, economic policy conditions must be stipulated for this, but even with the previously stipulated conditions it would still take years for the euro to be introduced.
In my view, we should not only check that the convergence criteria have remained unchanged, but that the EU is also handling the regulation governing the time which must be spent in the ERM II exchange rate mechanism in a more flexible manner than it does now. I also think that it is very important to examine how the process for joining the euro area could be accelerated, while fulfilling the conditions which can be fulfilled. This could then stabilise the situation in the affected countries, not to mention safeguard the EU's entire internal market. Otherwise, the possible international insolvency of the countries outside the euro area may, in a worst case scenario, bring down the euro area with it as well.
Liisa Jaakonsaari  
Mr President, the market economy is a good slave but a bad master. Recently, though, the roles have become rather confused. It is the custom at international conferences to speak trivia, but now we need action, and fast. The world now has a historic opportunity at the Pittsburgh G20 Summit to agree once again on the rules of the global economy. There has been a lot of talk in the press about bankers' bonuses, but they are only the tip of the iceberg. The global economy is in need of complete renovation and the keyword is transparency. We have to try and do away with the risk economy and move towards the real economy. Only binding international rules can guarantee that there will be no repetition of the casino economy we have witnessed in recent years. In future, the taxpayer should not be made to pay for the damage. There is always the risk with mechanisms like wealth taxes that someone in the global economy will turn out to be a freeloader. I think, however, that we should at least look into how relevant they might be.
Wojciech Michał Olejniczak  
The G20 Summit in Pittsburgh will be taking place practically on the first anniversary of the collapse of Lehman Brothers bank. This is the background against which world leaders should operate. The repercussions of the crisis have been felt by the inhabitants of almost every part of the globe. The primary aim of the G20 Summit should be to minimise the risk of the crisis caused by the deregulation of the financial markets from repeating itself. The G20 leaders face the task of creating regulation which will prevent further speculative banks from emerging and, to put it bluntly, swindling millions of customers of financial institutions all over the world.
In the last few months, we have been getting increasingly bad news about managers who brought their firms to the brink of collapse consuming public aid. In the last few years, we in Europe have been witnessing an unprecedented income gap not previously seen in the European social model. One of the tasks of the G20 group should be to level out incomes in Europe and on a world scale. The financial sector needs to have rules making bonuses dependent not on short-term profits, but on long-term returns on investments.
The leaders of several European countries as well as of the European Union as a whole will be present at Pittsburgh. That is why Europe should speak with one voice at the summit. I appeal to the representative of the European Union to remember that the interests of the Community include the interests of Member States which will not have national representatives at the summit.
Sirpa Pietikäinen  
On Monday this week, it was a questionable honour to work on what is a sort of anniversary: exactly a year before, the investment bank Lehman Brothers had collapsed. The collapse is regarded as having actually precipitated the current deep global recession and the financial crisis.
At a point in time so close to the anniversary and the approaching Pittsburgh G20 meeting, it is worth stopping to reflect on what has been learned and what can still be learned from the crisis. I see something crucial emerging from the crisis, and that is an opportunity to overhaul thoroughly the international financial architecture. There have already been steps taken in this direction. The G20 meeting last spring served as a good basis for action and guidance for global consensus on the measures required. The United States of America very recently announced a huge financial legislative package. The European Commission is expected to make a proposal for building the European financial architecture and its supervision next week. The key phrase here is 'global approach'.
We have to establish internationally binding rules on the reform of the International Monetary Fund, regulations on solvency, and new rules on the payment of options. The legislation must extend to all financial products, and it needs to be flexible so that it can always react to a changing sector, and one that launches new products.
In the grip of a crisis that is wrecking people's basic security, livelihoods and welfare, it is also constructive to think about new ways of measuring wealth. The final conclusions published by the commission that President Sarkozy recently appointed recommend a switch from measuring prosperity based on GDP to new methods which take account especially of a society's ability in economic terms to safeguard its citizens' well-being and environmental sustainability.
Catherine Stihler  
in writing. - I agree with those who spoke about the need for a global co-ordinated approach. This is essential if we are to change the power structures of the global financial system. However neither the Commission or the Council made comment about the concept of 'living wills' for the banking sector. This week marks the anniversary of the collapse of Lehman brothers. It is estimated that it will take ten years for the investment bank to be wound up. This is in contrast to the Dunfermline Building Society which had a life will enabling its assets to be clearly identified. Transparency is essential if we are to bring consumer confidence back to the banking sector.
