Conclusions of the G20 Summit (debate) 
President
The next item is the statements by the Council and the Commission on the conclusions of the G20 summit.
Petr Nečas
President-in-Office of the Council. - (CS) Mr President, ladies and gentlemen, on 2 April 2009 the meeting of the G20 heads of state and government was held in London to discuss further steps towards the recovery of the global economy and the prevention of future crises on such a scale. At their meeting the heads of state and government promised to do everything necessary to restore confidence, economic growth and employment, to amend the financial system in order to renew credit flows, to strengthen financial regulation, to restore confidence to the market and to fund and reform our international financial institutions in order to enable them to provide effective help in tackling this crisis and to prevent future crises. At the same time the heads of state and government made a commitment that in the interests of boosting prosperity they would promote global trade and investment and reject protectionism and that they would prepare the economy for inclusive, environmentally-friendly and sustainable growth and recovery.
The EU played a very significant role through its proposals and attitudes. In many areas, if not in the most, the EU and the European members of the G20 were the prime movers, or among the prime movers, of the work in the preparatory groups and they significantly influenced the breadth of the agreed consensus and the final form of the agreed proposals. This applied to the areas of financial market regulation and supervision, complete transparency in the financial system, the rejection of protectionism, the pressure to complete the Doha Development Agenda and the approach to economic recovery including the emphasis on the need to clear out the financial sector by removing worthless assets and creating a basis for a sustainable global economy in the future. Last but not least was the commitment of the EU countries to provide a financial injection to the IMF, which not only influenced the willingness of other countries to take on similar commitments, but above all played an important if not key role in the decision to stabilise economies that were unable to help themselves. This is to be done not through ad hoc solutions and bilateral assistance but through systematic use of the international institutions that exist for this purpose. In this way we will strengthen these institutions financially and also restore their respect and authority.
I would therefore like to take a look from a distance at what the London G20 Summit might mean for the world economy and for the EU in particular.
I will begin with a flashback to the year 1933. In June 1933 representatives from 66 countries met in London in order to try to create a common plan to restore the world economy in the middle of a great economic crisis. The London Monetary and Economic Conference, which had the objective of reviving global trade, stabilising prices and restoring the gold standard as the basis of the monetary system, was organised by the League of Nations and met under a similar global economic situation to the one we are experiencing today. Within a month, however, the conference ended in failure with a subsequent loss of confidence, further economic collapse and a chain of currency devaluations through which countries sought to strengthen their own economies at the expense of others. European states turned in on themselves and the US economy retreated into an isolationism which would last for many years. As the recession turned into a deep depression, unemployment and social tension grew and the political consequences of the tension led to the Second World War. In the weeks leading up to the London summit of 2009 it was hard not to recall the parallels with the London summit of 1933. Fortunately it seems that the world has learned from its experience, at least for now.
After many months of frustrated hopes and expectations, low confidence in the markets and deepening recession it was almost a political imperative for the G20 summit to end in success. It was a task of nightmare difficulty in view of the widely varying expectations of the different groups and countries and in view of the fact that some of these expectations were not entirely realistic. Ladies and gentlemen, it is too soon to say whether the G20 meeting was a success. Nevertheless, the weeks that have passed since the summit give grounds for cautious optimism that it really was a turning point in this global recession and that it may also become a key historical event in global economic cooperation. It may even stand the test of time and be accorded similar historical importance to the Bretton Woods Conference of 1944, which determined the shape of global economic cooperation for a quarter of a century and continues to influence it even after 60 years.
However, the historical importance of the ideas put forward at the G20 summit will become clear only when all commitments from the summit have been fulfilled, if indeed they ever are fulfilled. Despite this necessary circumspection there are four reasons why the London G20 meeting can be regarded as a successful start to economic recovery and to a new and more sustainable form of global economy and global economic decision-making.
The first reason is that the G20 really did boost confidence in the economy and in the markets. So far the increase in confidence has not been dramatic but a full return of confidence will naturally take time. The most important thing from the perspective of boosting confidence was the way the G20 participants behaved. Faced with a profound global collapse they maintained unity and they reached a broad consensus.
In the current period of uncertainty it was also vitally important that the G20 participants confirmed some of the fundamental economic paradigms: the core or the heart of our global recovery plan must be the jobs, needs and interests of people who are not afraid to work, and this applies across the whole world, not only in the rich countries but also in the poor countries. At the heart of our global recovery plan must be the needs and interests not only of people alive today but also of future generations. Recovery must not be at the expense of our children and grandchildren. The only reliable basis for sustainable globalisation and growing prosperity is an open world economy build on market principles, effective regulation and strong global institutions.
Secondly, the G20 summit sent a very strong signal - clearly the strongest in 60 years - that the world was returning to multilateralism in economic decision-making on matters of global consequence. In the summit conclusions the heads of state and government reaffirmed their conviction that prosperity is indivisible and that if economic growth is to be sustained then countries must share in that growth. If there is one lesson to be taken from the current global crisis, it is that we all share the same fate in economic terms. We are all in the same boat, large and small countries, open countries and closed-off countries. The interconnectedness of our economies has brought enormous benefits, particularly over the past 10-15 years, in the form of a long period free of major conflicts and in the form of unprecedented economic prosperity and the fastest global economic growth in human history, as well as opportunities for hundreds of millions of people to escape from extreme poverty. It has brought an expansion of markets for our producers, low inflation and low unemployment. We must not give up these advantages at any price. It is therefore absolutely essential to coordinate our policies, both in good times and in bad, and the G20 summit confirmed this fact.
Thirdly, the heads of state and government achieved consensus over matters where consensus seemed almost inconceivable just a year ago or even nine months ago. The commitments from London capped off three months of intensive discussions at a working level and they marked a real breakthrough. If they are fulfilled and put into practice then they will definitely provide a good basis for prevention so that we can avoid similarly destructive crises recurring over the coming decades.
Fourthly, the summit changed the shape of the space for global economic cooperation, leading to a new division of powers. The largest newly-emerging economies achieved full recognition of their role in the global economy. The developed countries and the rapidly developing economies also jointly acknowledged that the stability and prosperity of poor countries and the most vulnerable social groups everywhere in the world are in the interests of everyone. This marks a strategically significant change. It means that Europe will have to fight with a new vision and with sophisticated policies in order to retain its position in global economic decision-making. The size of the EU economy and the inheritance of the past will not in themselves suffice to maintain Europe's important strategic role in global economic decision-making in the future.
Nevertheless, from an EU perspective the results of the London summit were an undoubted success. The summit backed all the priorities agreed to by EU Member State leaders in the conclusions of the European Council of 19-20 March 2009. The London G20 summit rejected protectionism, made a commitment to a responsible and sustainable economic policy, supported multilateralism and backed all the priorities concerning financial sector regulation which EU Member States have collectively identified as fundamental. As has already been said, EU members were the prime movers or among the prime movers in the G20 negotiations over a range of issues. However, a number of questions remain open after the G20 summit.
Firstly, in the area of financial regulation and supervision, despite the enormous progress in recent months, a number of issues remain unresolved and are still being worked on. At the EU level, of course, there is a clear roadmap and timetable for the next two months and a division of roles between the European Commission, the European Central Bank, the European Financial Commission, ECOFIN and the June European Council. The programme includes, among other things, the immediate task of taking strong measures in the area of accounting standards that would enable European banks to operate under comparable competitive conditions to those of American banks.
Secondly, in the area of global trade the G20 leaders confirmed in London their earlier commitment from the Washington meeting not to create new trade barriers. The G20 summit also confirmed the commitment to complete the Doha Development Agenda "with an ambitious and balanced outcome”. However, this commitment had already been adopted at the G20 summit in November last year, where the heads of state and government even promised agreement over the Doha Development Agenda by the end of 2008. It therefore remains to be seen how serious the commitment is this time. Nevertheless the G20 leaders in London made a fresh declaration that from now on they would give their personal attention to the Doha Development Agenda and they guaranteed that political attention would be focused on Doha at all forthcoming international meetings that are relevant from this perspective. It must be one of the key priorities of the EU to press for the completion of these agreements.
Thirdly, the G20 summit participants made a commitment to provide USD 1.1 trillion through the IMF and multilateral development banks to help restore credit flows, economic growth and employment in the world economy. All that remains is to clarify and agree on the details of this commitment. The commitment covers short-term, medium-term and long-term stages and the short-term stage includes the EUR 75 billion promised to the IMF by EU countries for restoring balance of payment stability for countries in acute need of such assistance. The details of this commitment also remain to be worked out and the finance ministers of our countries must work on the form and mechanisms of this commitment.
Concerning the medium and long-term commitments to strengthen multilateral institutions, there is a commitment to provide the IMF with an unprecedentedly large multilateral loan of USD 500 billion. Besides this, the London summit produced a commitment that the G20 countries would support a new SDR (special drawdown rights) issue, in other words an issue in the IMF's own currency which can be used by IMF member states for mutual payments. The commitment speaks of SDR 250 billion. Like multilateral credit, an SDR issue involves relatively complex technical arrangements, including approvals from official IMF bodies, negotiations with participating countries and ratification of agreements by the national parliaments of member countries. All of this could take several years and it is therefore necessary to remain firm but realistic in our expectations.
The above commitments also involved an agreement that the G20 countries would do everything in their power to ensure rapid implementation of the April 2008 reforms to IMF decision-making structures, which are currently delayed by slow ratification in national parliaments. The G20 countries also asked the IMF to speed up the next round of reform in member shares and voting rights so that it is ready by January 2011. The EU countries must pay sufficient attention to this forthcoming reform because it may result in many EU Member States, large and small, losing the possibility of their national representatives participating directly and indirectly in IMF decision-making and losing direct access to information. There will also be reform aimed at strengthening the role of the IMF in global economic decision-making. For many EU Member States this issue has so far been of little interest but their attention must remain firmly focused on it in the coming months.
Fourthly, there is one remaining area requiring serious and careful discussion and a solution. This is the area of global inequality and the question of the whole global currency system in the future. These issues were deliberately excluded from the London summit agenda and as such they remain on the list of areas to be dealt with in the future. It is worth mentioning in this context that it was precisely the inability to agree on a global currency order which scuppered the London summit of 1933. This issue is no simpler today than it was then. The EU must devote an appropriate amount of attention to it, because a solution to this issue remains an important ingredient for sustainable economic recovery and for preventing devastating global crises.
Ladies and gentlemen, in conclusion I would like to thank Great Britain, the country hosting the G20 presidency, for organising the summit and above all for organising the entire process of discussion and negotiation at a working level in the weeks and months leading up to the summit. The organisers did an excellent job and they deserve our applause since they made a significant contribution to the progress achieved and to the breadth of the final consensus.
There is hope that the London G20 summit will usher in a new and successful era of global economic cooperation. I firmly believe that it has a decent chance. The conclusions of the G20 summit are an excellent starting point for bringing the global economic crisis to an end as quickly as possible. An opportunity has also opened up to change the shape of the future interconnected global economy in order to be better prepared for long-term sustainable production and coordinated economic decision-making. Much unfinished business remains and there are many commitments that have to be fulfilled. The coming months and years will show to what extent the London summit merits a place in the history books. In any case, the G20 summit marked a shift of strategic positions in the global economy. It is important for the EU to enter this new era with a clear and realistic vision and with policies that will ensure that Europe retains the same strategic role in the future as it has enjoyed in the past and which its 500 million citizens deserve.
Pervenche Berès
(FR) Mr President, I am well aware that nothing can be done against the Council, but even so, our work has been greatly delayed.
We have an agenda full of important discussions. Five minutes are set aside for the Council, and it speaks for 20 minutes. I believe this shows disrespect for the MEPs.
President
You know our Rules of Procedure as well as I do, Mrs Berès. I can use the gavel for all the Members, but I can only invite the Commission and the Council to be concise, as you have so notably been.
Commissioner, I beg you. You have no time limit, but please be aware that I have a piece of paper in front of me which says that five minutes would be acceptable.
Olli Rehn
Member of the Commission. - Mr President, the results of the London G20 Summit are substantial. They provide a clear message of global unity to work together to get the world economy out of the current crisis and back on the path of economic growth and job creation.
The G20 focused on three broad lines of action, and I am here today substituting for my colleague, Joaquín Almunia, who is driving those action lines further in a major IMF meeting today in Washington, and is thus unable to participate in this part-session.
Let me provide you with the Commission's concise assessment of the outcome, and of subsequent actions concerning these three broad action lines.
First, it is clear that the leaders agreed to do whatever it takes to restore growth, and for the moment the first and foremost priority is to restore the channels for credit flows. In this respect it is necessary to deal with impaired, toxic assets, thus endorsing the principles that the G20 finance ministers adopted in March, which is fully in line with the approach taken by the European Union.
It was also agreed to implement the announced economic stimulus measures without delay, and the EU's coordinated fiscal stimulus of over 3% - maybe closer to 4% - of GDP is substantial for Europe itself and provides a key contribution to the G20 short-term macroeconomic response to the crisis.
The outcome of the G20 should ensure an adequate balance between short-term fiscal expansion, which is, of course, necessary, and long-term fiscal sustainability, which calls for an orderly withdrawal of the stimulus when the time comes. Here also, the European consensus on the need to protect medium-term fiscal sustainability contributed to the balanced line adopted in London.
Trade protectionism is a potential threat in any global recession. It was therefore important that the G20 confirmed the commitment to keep trade and investment open and to avoid any kind of protectionism.
The second line of action is an ambitious plan to reshape global financial regulation, and it was agreed that, in future, regulations need to apply to every bank, everywhere, at all times. The G20 took a major step towards the global regulatory convergence that Europe has long been calling for.
We succeeded in obtaining the following objectives: improved requirements for bank capital and liquidity buffers, as well as measures to limit the build-up of leverage; regulation of hedge funds and private pools of capital; agreement on better regulation and supervision of credit derivative markets; more ambitious regulation for credit rating agencies; the establishment of global colleges of supervisors for all large cross-border banks; and endorsement of the new principles of the Financial Stability Board on executive pay and bonuses in financial institutions. Decisive action was also agreed on non-cooperative offshore tax havens. Thus, in the future there should be no hiding place in any part of the world for fiscal free riders. We welcome, in particular, the reference to the end of banking secrecy.
We also welcome the recent announcement by several countries to move towards the OECD standards on the exchange of information for tax purposes. Overall, concerning financial regulation, more progress has been made now than over the whole of the last decade.
Thirdly, it was agreed to reform the international financial institutions to ensure strong institutions for the global economy and provide appropriate representation for emerging and developing countries. It was agreed to substantially increase IMF resources, and the EU and its Member States have been steering the process and showing the way in this regard. Some countries have followed the EU and Japan's lead in pledging resources to the IMF, but more pledges are necessary, in particular from the United States and China.
Next, it is essential that the decisions taken by the G20 are delivered rapidly. We should also keep in mind to build a more balanced world economy and to avoid past mistakes. A fundamental adjustment of the global growth model - I am referring to the huge US budget deficit and the big Chinese trade surplus - may be needed in order for the global economy to return to a sustainable growth path.
The leaders agreed to meet again before the end of this year, probably in September. Effective coordination will be necessary to allow Europe to continue to steer the G20 process, which should be our continuous objective.
To conclude, tackling the current crisis requires both effective and coordinated fiscal stimulus and reform both of financial regulation and the international institutions.
Let us recall that this crisis originated from excesses and greed in the financial markets, especially on Wall Street. For Europe, it is a matter of returning to the basic values of the European model, which requires combining entrepreneurial initiatives, respect for productive work and striving for solidarity. In other words, our common challenge now is to save the European social market economy from the systemic errors of financial capitalism.
Joseph Daul
Mr President, Mr Nečas, Mr Rehn, ladies and gentlemen, we are suffering the first ever worldwide recession. This recession demands a coordinated response at international level. That is the only way that we can all come out of it.
The agreement reached at the G20 summit will help us find the right road to growth and jobs. In London, the world leaders tripled the funds allocated to the IMF, granted extra credits to the development banks and reaffirmed their support for free international trade. This programme, which aims to restore credit, growth and employment, should give us the time needed to stabilise the markets and, above all, to restore confidence in the global economy.
We must however be vigilant and not be tempted by easy solutions. We absolutely must lay the ghost of protectionism to rest. If we close our borders to trade and exchange, we will merely repeat the errors made by our predecessors in the 1929 crisis.
Today, more than ever, it is more trade that we need, not less. If we could manage, then, to create a real transatlantic economy without barriers with our main commercial partner, the United States, we would have already created an extra 3.5% of growth. That is what we should work on.
We must stimulate growth, not just to protect existing jobs, but also, and above all, to create new ones. My fellow Members on the left are calling for more social spending and for more social security. They want supposedly to protect jobs by closing off our economies. A transparent economy that allows each person to express their talents is an innovative and sustainable economy. It is a social market economy that we need.
We must learn the lessons from the mistakes of the last few months, and one of the main problems in the financial sector was the lack of financial regulation and supervision. The fact is, we will not be able to restore the confidence of our fellow citizens in the economy until we have restored confidence in our financial system.
To do so, we must extend regulation and supervision to all financial institutions and to all instruments, including hedge funds. We must fight against tax havens, get rid of banking secrecy and increase supervision of credit rating agencies.
In a globalised economy, where the markets never sleep, our only defence is transparency. Investors must know that the same standards apply throughout the world.
Finally, we also have a responsibility towards the developing countries. This crisis must not, in fact, ruin all the work we have put into this issue over the years. That is why we must continue to exert pressure so that the WTO adapts quickly to the 21st century and to the new rules.
The world's poorest nations need help to become real players in the global economy. In this way, the global economy will be able grow by USD 150 million a year. It is the developing countries that will receive most of this money.
This is why we support the G20 commitment to allocate 850 billion in additional resources to support growth in the emerging markets and the developing countries.
Ladies and gentlemen, we will only come out of the economic and financial crisis by changing, by changing international governance and by changing our tolerant attitude towards those who do not comply with the rules.
Poul Nyrup Rasmussen
on behalf of the PSE Group. - Mr President, the essential question is, of course, what to do now. What must Europe deliver when the G20 meeting is resumed in September this year?
I have here the very latest prognosis from the IMF. I regret to inform Commissioner Rehn that it states that, even including all we have done, economic development in the euro zone will go down this year by -4.2% in growth and, in Germany alone, the rate will be -5.6%. We have transposed that in our macroeconomic calculations, and I can tell you, colleagues, that this means that, in spring 2010, we will have 27 million unemployed in the European Union. This means in essence that, in two years, unemployment will have increased by 10 million jobs lost in the European Union.
We now need to act quickly, in a coordinated and effective manner, exactly as Olli Rehn said. The conclusion from the G20 in London was that, if there is a need to do more, then we agree to do more. I cannot say anything other than repeat the figure of 27 million unemployed people. Does one need further arguments to do more?
I would propose doing four things in preparation for the September G20: firstly, to prepare a new, coordinated effort to reduce this threat of mass unemployment; secondly, to follow the de Larosière group's two proposals - to establish a supervisory board and to give more competence to so-called CSR organisations; thirdly, to introduce effective financial regulation, covering hedge funds and private equity; and, fourthly, to prepare Europe to take a role in promoting a new global deal, including for those developing countries which have been hardest hit by this economic crisis.
Please, Commissioner, do not tell me one more time that you have made a financial stimulus of 4%, including automatic stabilisers. Next time it will be 5%, when unemployment increases to 27 million unemployed. Let us be fair and let us create the jobs. We can do it together.
Margarita Starkevičiūtė
on behalf of the ALDE Group. - (LT) I would also like to welcome the agreement reached in London, but at the same time underline that the global economy needs global governance. The European Union can take on the role of that leader for two reasons, because both after the war and after the collapse of the Soviet bloc, it was able to restructure its economies within a short space of time. We have significant experience in managing such complicated processes.
They must be based on structural reforms. We have to provide space for new initiatives. If we now concentrate attention on technical details, the improvement of regulation, which clearly is necessary, then we will lose the initiative and room for movement. Movement and new jobs only appear when structural changes take place. What structural changes can the European Union offer the world?
Above all we must modernise governance, modernise the European Union's financial markets, rest on the strength of our common European market and not shut ourselves away in our little national corners. If we are able to work together in the European common market, this will be an excellent example to the world, that we do not need to pursue protectionism, that it is precisely openness, cooperation, the movement of capital and macroeconomic balances, based on common agreements, which will help maintain stability and revive the economy. Europe's experience in this area is invaluable.
I always find it difficult to understand why we are not doing this. Perhaps we pay too much attention to those hedge funds and too little to people's lives.
Roberts Zīle
on behalf of the UEN Group. - (LV) Thank you, Mr President. Our draft resolution on the G20 summit says that, firstly, various European Union countries have received support from the International Monetary Fund to resolve balance of payments problems and, secondly, that various countries in the euro zone have, thanks directly to the euro, been able to avoid exchange rate pressure in this situation. Unfortunately, however, the new European Union Member States cannot reduce this currency risk pressure, because they cannot join the euro zone. At the same time, the economy has become overheated in several new EU states as a direct result of the injection of a very large amount of money by many European banks, fighting to carve out a market in these states. Now it is borrowers who have been left to bear all the currency risk. I would therefore appeal for us to consider, particularly in the new EU Member States that have joined the exchange rate mechanism tool and keep to a fixed exchange rate that allows a large part of these loans to be paid back to European banks, whether this should not mean that these countries should also be helped with a swifter introduction of the euro. This is particularly crucial because solidarity is extremely important in difficult times. In reality, we are all in the same boat - especially now, when, to be honest, even those countries that have already joined the euro cannot satisfy the Maastricht criteria, with budget deficits of over 10%. Since we are in the same boat, let us think in the same way! Thank you.
Caroline Lucas
on behalf of the Verts/ALE Group. - Mr President, the G20 was a massively missed opportunity for tackling both the environmental crisis and the economic crisis at the same time - in other words for introducing what we are calling a 'Green New Deal'. That meeting should have been the moment for a massive investment in renewable energy and energy efficiency, for example, not just because we have to urgently address the challenge of climate change, but because investment in green technologies is one of the best ways of getting people back to work.
Green energy, for example, is far more jobs-rich than investment in business as usual, yet the package agreed by the G20 will actually lock the world into a high-carbon economy at exactly the time that we should be shifting to a very different low-carbon sustainable economy. Billions of euros were found for the IMF and the World Bank, but for making that vital transition to a green economy there was no serious money on the table, just vague aspirations - just talks about talks.
The communiqué's words about climate change and the low-carbon economy were relegated to just two paragraphs at the end of the communiqué, with no specific commitments. It is a tragedy that, at the very moment when the economic system and the global environment are on a collision course, this crucial opportunity to change direction and to make sure that we tackle both of those crises and get people back to work was lost.
Francis Wurtz
Mr President, the assessment of the G20 results that we have just heard - success story, turning point in the crisis, an enormous success for the European Union, and so on - in my view raises two questions.
The first relates to the analysis of the current situation of the world financial system with which Europe, as has been seen, is closely connected. Let us be clear, the desire of the G20 leaders to send, at whatever cost, a reassuring message to the market, and indeed to the public, led them to very much play down the current situation.
In reality, forecasts of the estimated, but still largely hidden, banking losses are soaring from one month to the next. The worst is not behind us, it is in front of us. There was talk of losses of USD 2 000 billion three months ago, and that was already astronomical. Now, the IMF puts the figure at USD 4 000 billion.
For its part, the Commission has just put a figure of EUR 3 000 billion on the funds put aside under various guises by the Member States to save the banks, in other words a quarter of their GDP. That is the price of the mad dash to cash for profit and to profit for cash.
This grim reality underlines the importance of my second question. What is the real substance of the progress made on regulation by the G20 in London?
When Joseph Stiglitz, who was, as you know, appointed by the United Nations to chair an independent committee of experts on the financial crisis, was asked: 'Do you agree with the economist Simon Johnson when he says that the regulatory aspect of the G20 is close to zero?', Mr Stiglitz replied, 'Yes, I do'.
The ink on the London statement was not even dry when the main member state of the G20, the United States, called on the speculative funds that are comfortably installed in the tax havens to buy at a knock-down price the toxic assets that are blocking the balance sheets of the US banks. We are really raising capitalism's moral standards.
In truth, the G20 did nothing to stop liberal globalisation. It ignored the key question of reorganising the international monetary system. It promoted the IMF without considering its transformation. It drew a veil over the immense social challenge created by this crisis. It prescribed homeopathic remedies where major surgery is obviously needed.
Europe, I think, must go far beyond the G20. The house is on fire. Do you hear the cries of anger rising up from our societies? They are demanding not soothing words, but strong, practical action, now!
Jana Bobošíková
- (CS) Ladies and gentlemen, the decision of the G20 summit to pour billions of dollars into the IMF to combat the crisis is in my opinion counterproductive and harmful. There are three immediate reasons for this. Firstly, this commitment obliges creditor countries either to reach into their foreign exchange reserves or to go into debt.
Secondly, the commitment obliges even those states that have suffered lasting damage from incompetent IMF analyses to contribute to the fund. The Czech Republic, whose citizens I represent here, is an example of this. Although IMF forecasts for my country are completely divorced from reality, Czech citizens are contributing USD 1.4 billion to the fund.
Thirdly, the IMF will lend money to states under much softer rules than hitherto and it will not press for loans to be made conditional on the drafting of realistic measures to solve the economic problems of the borrower.
Ladies and gentlemen, I firmly believe that this will lead to a deformation of the international credit market at the expense of taxpayers.
Othmar Karas
(DE) Mr President, President-in-Office, ladies and gentlemen, the summit was a political success and sent out an important message, namely that the world is closing ranks and the political will is there to jointly find and apply global answers to crises and challenges. Nonetheless, I should like to say very clearly that we should not exaggerate the importance of summit scenarios. Summits only make declarations of intent; summits do not take decisions, summits are not legislators, summits have no legal basis.
Several calls are being made on the European Union. We must have the ambition to take on a vanguard role in the construction of a global financial and economic order. However, we can only take on a vanguard role if we have European regulations and can offer models. We are on the right path with our model of a social market economy, with deposit guarantees and with the regulation on credit rating agencies passed today. However, for me, the results of the summit are lacking in clear agreement on the elimination of the pro-cyclic effects of the existing regulations at European level and globally, the watchword being Basel II.
We still have a great deal to do: hedge funds, managers' salaries, the banking directive and European supervision, to name but a few. We are spokesmen, through the Commission, for this continent. Nonetheless, the national states are also represented. Community interests stand alongside national interests on the world stage. This may be an opportunity, but it may also be a weakness. That is why coordination is especially important. If our representatives do not all pull in the same direction, we shall be weakened on the global stage.
My final point: the legal implementation of political declarations of intent, their implementation and the coordination of global implementation in time and content will determine our success. The summit merely points the way. The result is yet to be achieved.
Elisa Ferreira
(PT) Mr President, the G20 Summit was important, particularly because it created a space for multilateral dialogue and made people realise that, without this multilateralism, the crisis cannot be solved. However, it was a starting point, not an end point. The European Union's role in this must be reinforced and clarified, and the EU must act as a driving force. As yet we have no indication that this will happen.
We do have an extremely important guide, namely the de Larosière report, but the Commission has been slow to implement it and slow to react. Look at the reaction to hedge funds, for example. In the meantime, the real economy in Europe is still not showing any signs of recovery, and the 'wait-and-see' policy that has been followed means waiting for worse figures and for an increasingly serious situation. Look at the latest estimates from the International Monetary Fund and the OECD (Organisation for Economic Co-operation and Development) of 27 million people unemployed, which is a huge problem.
The Commission also owes explanations to this House on what it intends to do, what its initiative actually involves and what the state of play is with the policy to coordinate Member States' initiatives. We should not have to wait any longer. The political will to act should already exist.
Rebecca Harms
(DE) Mr President, ladies and gentlemen, G20 is indeed the right way forward; in time G8 will have to be dissolved by G20. Then we would have one summit less. Europeans have failed. The European Union with 27 Member States is indeed the right arena in which to organise a new financial market order.
To date we have had a lot of talk on this but no clear resolutions. We have heard a great deal about clearing tax havens, control of hedge funds and the end of fraudulent financial market products. If the Europeans had gone to London with a policy position, who would have actually been able to stand up against them? I find, as my honourable friend Mrs Lucas said, that it is infuriating that the London summit simply adjourned the climate crisis and the security of energy supply crisis. That has not only inflicted a great deal of damage on the climate and security of energy supply, but has also gambled away the opportunity for thousands of new jobs.
Hans-Peter Martin
(DE) Mr President, I can follow on seamlessly here. It is a tragedy that this continent is unable to reach a majority on what my fellow Member Mrs Lucas referred to. If it were, we would be in a far better position and could look future generations in the eye. As things stand, we cannot.
A criticism that I have to make is that much of the debate about the financial disaster and the way in which the emerging or already real climate catastrophe is being pushed aside reminds me of the German Bundestag after the Second World War. Many members of parliament and many politicians in the Bundestag no longer had any interest in what had happened up to 1945. They had to be confronted with it slowly. That is the starting point: unless you conquer the past, examine your own mistakes and look to the future, there is no way forwards. The EU and, more importantly, the political actors failed dramatically in the financial crisis. They must draw conclusions from that and first learn what they did wrong.
Jean-Paul Gauzès
(FR) Mr President, ladies and gentlemen, in the resolution that it will adopt tomorrow, Parliament will welcome the positions taken on credit rating agencies, which aim to increase transparency and to strengthen cooperation between the national supervisory authorities.
In this respect, this very day, Europe has shown the way forward. This morning, COREPER adopted the compromise reached between the Member States, the Commission and Parliament At noon today, Parliament, in turn, adopted the compromise by an overwhelming majority of 569 votes to 47. Therefore, the regulation proposed by the Commission and amended by Parliament will quickly come into effect.
I would like to stress that this regulation lays the foundations for European supervision in the spirit of the proposals in the de Larosière report. The CESR will be the single entry point for registering agencies and it will initially play a coordinator role.
The Commission has undertaken to propose, in the next few months, a legislative initiative that will enable the finishing touches to be put to a truly European supervisory system.
Before concluding, I would like to stress that the return of confidence, which is the real objective of all the measures taken, obviously hinges on better regulation, especially of the financial system.
However, we must also take into account the fears of our fellow citizens and respond positively to them. We should give them realistic messages of hope. Unless we improve the morale of our fellow citizens, we will not restore consumer confidence, without which economic recovery will not be possible The information provided to our fellow citizens has to be balanced and honest and not encourage defeatism by hiding the progress, the successes and practical consequences of the recovery plans, whilst taking into account the timescales necessary for them to produce their effects.
Pervenche Berès
(FR) Mr President, I wanted to say to Mr Daul, but he has left, that today it is astonishing to see the Conservatives accusing we Socialists of wanting to increase social spending, when their main argument for rejecting the recovery plans is that Europe has the famous automatic stabilisers. What are these if not unemployment benefits, which we have defended with great clamour?
On the G20, I will make one main criticism: they have adopted the Barroso method, which consists in adding together the existing plans and assuming that that makes a recovery plan. That is not a recovery plan. Furthermore, looking at the figures from the OECD yesterday, from the IMF today, from the Commission tomorrow, how can anyone imagine that Europe can be satisfied with this?
We need a real European recovery, and the only method you have for this, Commissioner, is funding with a European loan. It is time for you to get to work, even though this European Parliament will no longer be there to support you in this task.
Finally, I note that the G20 had a task to carry out, following a message sent to it by Dominique Strauss-Kahn on the eve of its work: 'The system will not recover whilst the question of toxic assets remains unresolved'. Clearly, in this respect, the G20 was incompetent. We still have everything to do.
Two points: the G20 conclusions assess the benefits of the Doha Round at USD 150 billion. Where does this figure come from? How can it be justified? We call on you, Commissioner, to explain.
Finally, on supervision, if Europe wants to go down the right road, it must, as a matter of urgency, implement the de Larosière group's proposals.
Antolín Sánchez Presedo
(ES) Mr President, the G20 has sent out a valuable message: prosperity is indivisible, and the only sustainable recovery is a shared and inclusive one.
What we need to do now is make this a reality. We need to continue in this direction. The G20 has reaffirmed common priorities, made agreements to provide resources to the International Monetary Fund, development banks and for the promotion of trade. It has carried out reforms in global financial governance, implemented ambitious plans with regard to regulation and supervision, and has made progress in the fight against tax havens.
Without the G20, the situation would be desperate, and the sickness in the world economy could become chronic.
However, the most important thing to realise is that the G20 initiative is not an event but rather a process. The European Union is the most important, integrated, and balanced economic area in the world, and therefore must lead the way, as it has great potential and can enrich the global agenda with the realisation that we are not only in the midst of a cyclical crisis, but actually confronting a crisis with deeper roots, which requires the political initiative of the European Union.
DanutBudreikait
- (LT) One of the measures given in the statement issued by the International Monetary Fund on opportunities for the EU's Central and Eastern European countries to exit the crisis more swiftly is the introduction of the euro. This is proposed for countries which have currency boards. In Lithuania the litas has been pegged to the euro at an unchanged rate for four years, which is twice as long as the currency board mechanism requires. We should also reduce the exchange rate mechanism period to one year for other non-euro zone countries. The economic slump in the EU and throughout the world calls for novel, speedy and creative decisions and compromises, all the more so because in the ten years of the euro's existence, not one euro zone country has implemented all of the euro zone criteria and requirements, the Maastricht criteria.
Bart Staes
(NL) I wish to take this opportunity to denounce a bit of hypocrisy with regard to the G20 summit. This summit was announced as a historic agreement, as something unbelievable, as a step forward, for instance in the fight against tax fraud and tax havens. A black, a grey and a white list were also drawn up.
But the hypocrisy of the European Union lies in the fact that - to give but one example - barely a week and a half before the G20 summit, we entered into an economic partnership agreement with the Caribbean countries. Eight of the fourteen countries are tax havens and yet we signed a free trade agreement with those countries, the result of which will be to institute free trade and the liberalisation of financial services, the consequence of which will be that toxic credits and illicit money can freely flow from those tax havens into the European Union.
I would thus like to take this opportunity to complain about the hypocrisy of having a good media show, the G20 summit, which claims it will take on tax havens, and in practice a policy that is diametrically opposed to what has been said. That is what I wanted to say.
Petr Nečas
President-in-Office of the Council. - (CS) Ladies and gentlemen, thank you very much for the discussion. I would like to state clearly that I agree with Mr Daul, who identified the avoidance of protectionism as a key factor. Protectionism works like a cancer and it could completely destroy our economy, turning against EU citizens and leading to a deepening economic crisis and a further decline in living standards. I also agree very much with Mr Daul's call for a transparent economy with effective and sensible levels of regulation and of course stronger global financial institutions.
Mr Rasmussen and Mrs Starkevičiūttalked of pouring money into the economy. I must emphasise here that we are not pouring money into the economy in order to assist financial institutions. Inasmuch as we are doing it, the aim is to boost employment and to help people hold on to their jobs, because we all agree that the most dignified way for EU citizens to secure a living is through their own work. At the same time, however, in implementing these financial stimulus measures for the economy we must think not only of ourselves but also of our children and grandchildren. In other words these measures must not lead to any dramatic long-term threat to the stability of public finances. Our efforts must be focused on protecting employment and therefore the European Commission in cooperation with the Presidency will organise an employment summit where the top priority will be measures in the area of employment.
I would like to voice my disagreement with Mrs Lucas. I completely disagree that the G20 summit was a lost opportunity but I must challenge all of us to show some political realism. The current economy is sick. It needs a cure, it needs first aid, it needs long-term care and it needs a period of convalescence. We must not expect positive results to appear suddenly over the next three to four months. The problems affecting the global economy - and therefore the European economy too - are deeply-rooted and long-term in nature. Therefore the treatment must be long-term as well and it will require patience. I firmly believe that from this perspective the G20 summit represents a positive step.
Mr Wurtz criticised the superficiality of the financial market agreements. I agree that in many respects the EU must go deeper and I also firmly believe that this is happening. We must not look only at the steps taken by heads of state and government leaders, but also at those of finance ministers, which are very often consigned to annexes of various documents. I would also like to emphasise that the European Commission has already discussed further specific measures this week. However, I would again make a call for realism. We cannot expect miracle cures to be found within the next three or four months. The world economy is in trouble and the cure will be very long-term. It is essential to emphasise that even within an EU framework we must proceed in a coordinated manner. None of us exist in isolation. Only through coordinated action can we successfully overcome the effects of the global economic crisis.
Olli Rehn
Member of the Commission. - Mr President, I would like to thank you for a very serious and constructive debate. I will of course report this to the Commission, President Barroso and my colleague, Joaquín Almunia.
I have two or three comments, firstly on the European economic recovery plan. Like Poul Nyrup Rasmussen, I have of course taken careful note of the latest IMF economic outlook, which is indeed a very gloomy read. At the same time, it is essential to note that we have already taken very substantial and significant policy decisions to stimulate the European economy and the world economy. This has already, by and large, helped to stop the financial meltdown. But of course it is only honest to say that there will still be bad news coming from the real economy for some time, especially as regards increasing unemployment. Therefore we have to be very alert and vigilant. We have to constantly assess how the economic recovery package, the fiscal stimulus and the financial reforms are working and producing results. If necessary, we will have to do more - and better - in the course of the coming months.
We are doing our homework on the financial market reform, as a response to several colleagues. On the Commission agenda next week, for instance, we have a major package of legislation concerning the financial markets, especially the Director's remuneration, and a recommendation on the remuneration policies in the financial services sector. This is a very important part of the reforms of the financial markets.
Finally, while the reform of the financial regulation in Europe, and in the world globally, is indeed necessary in order to correct the system errors of financial capitalism, at the same time it is important that we do not throw the baby out with the bathwater as regards the market economy as such. In other words, we have to preserve the single market - which has been the engine of welfare in Europe - and we have to work for a new world trade deal in the context of the World Trade Organisation. As Mr Daul said, we need more, not less, trade. This is especially important for developing countries, which are very badly hurt because of the current recession and the slowing-down of world trade.
As replacement for Louis Michel next month, I am also involved in this because of my portfolio responsibilities. Indeed, the developing countries are among those which are suffering most from this economic recession. Therefore we should not lose momentum on rapidly reaching an ambitious conclusion of the Doha Development Round. In the current economic climate the value of concluding Doha has gone up very substantially. Doha would boost the world economy and prevent protectionism from picking up. Therefore all G20 countries should look beyond their domestic political garden and show a real commitment to moving ahead without delay as regards the Doha Development Round. I think it is also important to note, from the point of view of development, that leaders in the G20 also agreed on a trade finance package worth USD 250 billion over two years to support global trade flows, to which Europe will contribute substantially.
President
I would point out that, in accordance with Rule 103(2) of the Rules of Procedure, I have received six motions for resolutions tabled by the six main groups of this Parliament at the end of this debate.
The debate is closed.
The vote will take place on Friday, 24 April 2009.
