Good afternoon ladies and gentlemen,
I will come to the European Council tomorrow with a message on growth – sustainable growth. It was this message that I was bringing already to the last informal European Council. Indeed, the answer on growth has been at the core of our agenda from the start, and I am pleased to say that we are starting to see a level of commitment by Heads of Government and Heads of State which I now hope will be translated into effective, concrete delivery.
We now need to invest as much in getting Europe back into growth as we are currently investing in getting Europe out of the crisis.
This spotlight on growth is justified because we have been making significant progress on other priorities.
First, on economic governance, the so called six-pack has been adopted and we are applying it vigorously. The Treaty on Stability, Coordination and Governance has been agreed and will be signed the day after tomorrow. The European Council will agree economic policy orientations for the European Union for this year.
Second, the financial markets and the banking sector are indeed recovering. The risk of a credit crunch is receding thanks also to the decisive action of the ECB.
Third, the financial firewalls are being strengthened. We have agreed on how to leverage the EFSF lending capacity and accelerated the establishment of the ESM by one year to July 2012. I'm confident that in the coming weeks we will see a decision that ensures the right level of firepowers of the ESM and the EFSF.
Fourth, on Greece we have made real progress in the last couple of weeks. The second Greek programme has been agreed in principle. The private sector bond exchange is on its way, and I will meet Prime Minister Papademos later this afternoon with several of my colleagues of the Commission and his team to discuss how we can work to support the reforms Greece is making and how we can work even harder to maximise the impact of European funds to return Greece to Growth.
So without being complacent, I think we can begin to be confident that we are laying the conditions to increase the growth potential for Greece, if we stay the course.
Regarding Europe in general, while our forecasts show mild recession for this year, the Interim Economic Forecast also points to the return to growth in the second half of the year. The figures released today - both in terms of our economic sentiment indicator and the business climate indicator - show an increasing confidence for the second month running. Industry is starting to believe. It is time to build on that possibility of confidence.
So as you understand, I am being extremely prudent with my words. I think we may have the conditions now to start changing the perspectives. Perspectives are very important because the key issues is precisely the issue of confidence, of trust.
That's why I want to make the discussion on growth to be as concrete as possible. What is needed now is not all the time new plans for growth but a firm commitment to delivering what has been agreed. We have a growth strategy. It is called Europe 2020. What we need is proper buy-in and ownership by Heads of State and Government and not only by the Heads of State and Government, not only by the European Council when Heads of State and Government come here to Brussels – but also by Member States themselves, by the social partners, the trade unions, the business community, the regions, the local authorities. This is the important issue, to avoid the disconnect that so often happens between the decisions taken here in Brussels and afterwards the implementation of those decisions. We have the economic priorities in the Annual Growth Survey which now will feed into the National Reform Programmes and the Commission's Country-Specific Recommendations. What we need is for these to be turned into action.
At the last informal European Council I called for priority to be given to two issues which are key to our growth drive: reducing youth unemployment and increasing support for small businesses. In the last couple of weeks Commission experts have visited the eight Member States with the highest levels of youth unemployment. I believe that these Member States will develop credible national job plans by mid April as agreed.
Tomorrow, I would like the European Council to focus on two other issues we need to boost the growth potential for Europe: funding for transport, energy and ICT infrastructure projects and secondly, the urgency of bringing down the cost of broadband roll out.
It is urgent to get investment flowing into these vital infrastructures so we can complete the single market. This is why it is so important that our pilot initiative on project bonds can be launched as soon as possible. With an allocation of €230 million from the EU budget we expect to be able to mobilise investments of up to €4.6 billion.
And we need to cut the cost of broadband roll-out. A study we released yesterday shows that €110 billion a year could be generated – more than 0.8% of GDP if the internal market for electronic communications were completed.
So this European Council should be – you never know but should be – with less drama that the last Summits. I'm sure you will agree, a little less drama will do no one any harm.
