x
Breaking News
0

As reform drive sags, euro summit to push integration

EconomyDec 07, 2017 10:30AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. President of the European Council Donald Tusk arrives at a press conference at Government buildings in Dublin

By Jan Strupczewski and Alastair Macdonald

BRUSSELS (Reuters) - A return to good times for Europe's economy may be sapping will to reform the euro zone before talks even start, so investors will be watching closely next Friday when EU leaders discuss how to deepen cooperation to protect against any return to crisis.

"In the absence of market pressure, the collective political will to make further progress has weakened," European Council President Donald Tusk cautioned in a letter, seen by Reuters, that invites the 27 leaders to the Dec. 15 euro summit.

The euro zone economy is set to grow at its fastest pace in a decade and unemployment is at eight-year lows. Despite the economic success, the bloc faces strong anti-EU sentiment among voters, expressed in Britain's decision to leave in 2019.

Weakened by Britain's departure, the EU also has to face the rising economic power of China, increased global protectionism, migration challenges and tensions with Russia. The best response to these risks is increased EU unity, top EU officials say.

The European Commission proposed on Wednesday ideas for deeper integration of the 19 countries that share the euro that will feed into the leaders' discussions next week.

But it was also careful to leave the door open for eight non-euro countries to join all the initiatives to help unite the broader European Union around the single currency, which all except Denmark -- and Britain -- are obligated to adopt one day.

But while all the 27 governments that will remain in the EU agree a stable and shock-resilient euro zone is in everybody's interest, they differ on what needs to be done and how quickly.

Top EU officials in Brussels have underlined that it is time to "fix the roof is when the sun is shining", calling on leaders to take advantage of the fastest economic growth and a less busy election agenda across the bloc to commit to reforms.

But Jeroen Dijsselbloem, the outgoing chairman of euro zone finance ministers who will do most of the work on euro zone reform before leaders take final decisions in June 2018, warned last week of growing complacency.

"Things are going so well, the banks are better, the economy is better, I see too many politicians relaxing and really we need to do more work," he said.

The 27 EU leaders will be asked next Friday to give their finance ministers the go-ahead to work on the various reform ideas, which include setting up a euro zone fiscal capacity and creating the post of a European minister of economy and finance.

Other reform topics include a simplification of the EU's fiscal rules and turning the euro zone bailout fund into a European Monetary Fund, which would also be a financial backstop to a bank resolution fund.

Finally the leaders will be asked to say how they would like to approach the gradual introduction of a European Deposit Insurance Scheme that would boost the euro zone banking sector.

Except for mandating further work on the various reforms and spelling out which ones should have priority, the leaders will not take any decisions next week, not least because of sharply differing views on most of the topics and the lack of a mandated government in the bloc's biggest member Germany.

(Writing By Jan Strupczewski; Editing by Alastair Macdonald and Toby Chopra)

As reform drive sags, euro summit to push integration
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

 
Are you sure you want to delete this chart?
 
Write your thoughts here
 
Replace the attached chart with a new chart ?
Post
Post also to:
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
 
Replace the attached chart with a new chart ?
Post 1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email