Sunday

4th Dec 2022

EU leaders told to practice what they preach on economy

  • Crisis - what crisis? EU leaders share a moment of levity during the family photo at this week's summit (Photo: The Council of the European Union)

Top EU officials on Friday (2 March) urged national leaders to implement their fine talk on jobs and growth, in the first mild-mannered summit after months of high tension on the euro crisis.

"A drama-free summit was not a bad thing. Precisely because there was no drama, we can now focus on structural reforms for youth unemployment, small and medium enterprises, project bonds and the roll-out of broadband," EU commission chief Jose Manuel Barroso told a press conference at the end of the two-day meeting.

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He insisted that leaders need to "take full ownership" and fill the "implementation gap" between what they say in summit statements and what they do when they get home.

The commission is to monitor and produce more detailed reports on economic reforms, ranging from labour market changes to investment in R&D.

For their part, leaders pledged to solve the outstanding issue of the EU patent court headquarters by June - the last step in a 30-year-old saga aimed to create a unified patent system across the bloc.

Spain and Italy are still outside the scheme, while a Franco-German-British spat over who is to host the headquarters has delayed final approval.

Meanwhile, diplomats said British Prime Minister David Cameron at a dinner discussion on Thursday evening voiced frustration that an eight-point letter on the economy which he put forward with 11 other leaders - including Italy's Mario Monti - was not taken into account in the council conclusions.

Speaking on Friday, EU Council chief Herman Van Rompuy said "the most important points" of the letter - such as the creation of a digital single market - had been taken on board.

But due to French objections, the conclusions do not include Cameron's call for new legislation opening up the services market.

Some delegates saw the letter as a stunt to show that Britain still has a say in EU affairs.

Britain has been increasingly isolated since Cameron in December vetoed changing the EU Treaty for the sake of greater fiscal discipline. The ensuing legal mess saw 25 member states on Friday sign an intergovernmental pact instead.

Spanish tension

Meanwhile, sticking to the new budget deficit targets is looking increasingly difficult for some countries, notably recession-hit Spain.

Speaking to reporters on his way out of the summit, Spanish Prime Minister Mariano Rajoy said his deficit this year will be 5.8 percent of GDP, instead of the 4.4 percent target agreed with the EU commission a few months ago. He felt confident that he would not face any sanctions despite the glitch.

"Let's see what other countries come up with," he said, referring to budget reports member states are to send to the EU commission in Spring. The Netherlands has already said its deficit will be over four percent this year.

Echoing Barroso, EU Council chief Van Rompuy also said deficit targets must be respected.

He noted that countries should not cut too much from education, training or green energy funding and that individual member states are battling different kinds of problems.

"You can't compare Netherlands and Belgium with Spain, the unemployment figures are very different ... But for the credibility of the exercise we have to stick to the targets, [or] else we'll be punished by the markets. What we think we would gain through not sticking to targets, we would lose by an increase in interest rates."

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Germany's vision of an EU of fiscally prudent states held in check by tight budgetary laws and the threat of legal action came a step closer on Friday when 25 leaders signed a new fiscal treaty.

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MPs on the UK's House of Commons European Scrutiny committee have demanded that the new EU patent court be based in London in order to mitigate against what it described as "the most damaging effects of a unitary EU-wide patent".

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