I want to begin by just mentioning the anniversary that we have just commemorated today at the Eurogroup meeting. Twenty years ago, our central banks started shipping some 15 billion euro of banknotes and some 52 billion of euro coins to all corners of the euro area in readiness for the 1 January 2002 changeover to euro cash. The euro family has grown over the past 20 years, going from 12 members in 2002 to 19 today, with, we hope, more on the way.
We faced many challenges during those two decades and in the next 20 years to come I know we will surely face fresh challenges but also confront and take advantage of new opportunities. It’s part of our collective responsibility, in the Eurogroup, to ensure we are ready for what lies ahead. One of the priorities is completing the Banking Union and to that end I have invited my fellow Ministers to a dinner tonight to take stock on where we are and to identify how we can move forward.
Back to today’s agenda.
We started with Greece, taking stock of progress on the basis of the 12th enhanced surveillance report. We welcomed the progress achieved in policy reform despite the difficult circumstances of the pandemic and the terrible fires of August 2021. We gave our political agreement to the release of the sixth tranche of policy-contingent debt measures, which are worth 767 million euros. We issued a statement to this end.
We then reviewed the progress of the economic situation in Spain, Cyprus, Portugal and my own country – Ireland – on the basis of the Post Programme Surveillance Reports that were presented by our institutions. These reports were overall positive and confirm that strong economic recoveries were underway in 2021, supported by vaccine rollout, European-level policies and the measures taken in each country to decisively address the pandemic situation and its economic consequences.
Then, we looked to the year ahead, we discussed our joint priorities, which are reflected in the Work Programme that we have just endorsed. I want to mention two important themes: firstly supporting the recovery and long term growth and secondly strengthening the Banking Union, so a word on each.
First, in the Eurogroup we will continue to coordinate our action at national and European level to support the recovery and to deliver long-term growth. In that context, we discussed the appropriate fiscal policy that we will implement for 2023. I am working with the Commission and we have identified how and by when we will look to achieve consensus on that. We also discussed the role of the Eurogroup in the debate on the future of economic governance.
The second priority is with regard to strengthening the Banking Union. Because we believe that a stronger Banking Union in Europe will contribute to our recovery, more jobs and investment in Europe.
We will also continue to regularly exchange views on the possible issuance of a digital euro, focusing on its political dimensions and also discussion on the future of euro area enlargement.
We then moved on to our main block of policy discussions focusing on the year ahead. Kristalina Georgieva gave us an overview of the IMF’s assessment of the economic situation and policy priorities, which I know are communicated publicly as I speak.
What’s important to note is that the IMF commends our coordinated policy response, which has helped the euro area economy to recover strongly in 2021 and build the grounds for good prospects for 2022.
The Recovery Fund is now coming on stream and it is an important tool to help shield us from emerging health risks and boost our efforts for a sustained recovery.
The emergence of new COVID variants is a reminder that policy support is still needed and that we should continue to monitor developments very closely. However, the economic recovery is strong enough now to warrant a shift from broad support measures to more targeted responses.
These are also the policy priorities identified by the Commission in their proposal for a Council recommendation on the economic policies for the euro area, which Commissioner Gentiloni presented today.
We also discussed in more detail fiscal policy, with our annual discussion of draft budgetary plans for the year ahead. The statement we just issued confirms the importance of maintaining moderate fiscal support in 2022, while remaining agile and ensuring that measures are well targeted as we continue to respond to health environment that changes.
We welcome the Commission’s assessment that Member States’ plans are intended to support the recovery and that nationally financed investment is planned to be preserved or broadly preserved in 2022 in all euro area Member States.
At the same time, we note the importance of controlling the growth of current expenditure, especially for Member States with higher debt levels. We will get back to the issue of fiscal policy guidance for 2023 early next year, based on a proposal from the Commission.
That’s a quick version of our discussion today, further details are in the statements but I’ll stop here and hand over to my colleagues.
