Wednesday

17th Apr 2024

EU to G20: We will not take 'economic lessons'

The EU is not prepared to take economic lessons from its G20 partners, the president of the European Commission said Monday (18 June) amid international fears the eurozone crisis could put the global economy back into recession.

"Frankly we are not coming here to take lessons on democracy or on how to handle the economy," said Jose Manuel Barroso ahead of a G20 meeting in Mexico, where the eurozone crisis was expected to play a central part in discussions.

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With Washington in particular making increasingly pointed comments about how the 17-nation club is tackling its two-year-long debt crisis, Barroso noted that the US is the original source of problem.

"The crisis did not originate in Europe ... this crisis was originated in North America. And many [in] our financial sector were contaminated by unorthodox practices from some sectors of the financial market."

He added that this is why he expected the G20 - a gathering of the world's major economies - to "speak very clearly in favour" of the approach the EU is taking.

Barroso also hit back at the barely-concealed exasperation at how slowly the eurozone takes decisions, with the crisis having moved from the relatively small economies of Greece, Ireland and Portugal to threatening Spain and Italy.

"In Europe we are open democracies. Not all members of the G20 are open democracies. We are certainly not coming here to receive lessons."

He was backed up, with milder words, by Herman Van Rompuy, President of the European Council.

"We are correcting our internal balances and a lot of other countries have to correct their huge external imbalances," said Van Rompuy. "We are not the only ones responsible for the economic problems all over the world."

Van Rompuy also pointed out that Europe is expected to return to growth next year after suffering a "mild recession" this year.

Both he and Barroso called on G20 partners to make good on pledges to contribute to a $430 billion firewall to help contain Europe's crisis - with China and Brazil among those who so far have not said how much they will pay towards the measures.

Asked why others should help bail out what is one of the richest regions in the world, Barroso said that it is in their interests to see Europe "stabilised."

Meanwhile, international partners were told not to expect a departure from the eurozone's incremental approach to dealing with its crisis.

When EU leaders meet for their summit next week they will "not take definitive decisions," said Van Rompuy. Instead they will "prepare the work" for economic and monetary union, with "banking integration" likely to be the area where the fastest progress can be made.

As for the rest - fiscal and economic integration as well as "democratic legitimacy" - this will depend on whether it involves a time-consuming treaty, said Van Rompuy.

"The most important thing is that we should willingness to correct the policy infrastructure. The pace is less important than the decision we make."

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