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[Luxembourg 2005 Presidency of the Council of the European Union]
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Press Release
Jean-Claude Juncker presided over the meetings of the "Economic and Financial Affairs" Council and the Eurogroup on 17 and 18 January 2005 in Brussels

Date of release : 18-01-2005

Policy area : Economic and Financial Affairs Economic and Financial Affairs

Event : Economic and Financial Affairs Council


In his capacity as current President of the "Economic and Financial Affairs" Council, and as President of the Eurogroup, Luxembourg Prime Minister and Minister of Finance Jean-Claude Juncker presided over the first meetings of these two entities under the Luxembourg Presidency on 17 and 18 January 2005, in Brussels.

The Luxembourg delegation was represented by the Minister of Economy and Foreign Trade, Jeannot Krecké.

Both meetings were essentially spent reviewing the stability and growth pact. A political agreement on new rules for implementing the pact is expected before the European Council meeting on 22 and 23 March 2005, in Brussels.

After six hours of discussions in the Eurogroup and two more hours in the "Economic and Financial Affairs" Council, President Juncker said that he was "reasonably optimistic" that the review of the pact could be completed on schedule. Jean-Claude Juncker praised the fact that "everyone's positions are becoming closer"and especially "that the extreme positions" between those who advocate a mechanical implementation of the pact and those who prefer unlimited flexibility "have been abandoned."

Jean-Claude Juncker stated that he was "particularly satisfied" that everyone has agreed on three essential ideas: "that not even one comma of our interpretation of the Treaty can be called into question;" that the implementation of the excessive deficit procedures will not be challenged and that, therefore, the European Commission's right of initiative in this matter remains intact; and that, from now on, there will be no "removing of entire blocks of expenditures from the aplication of the stability and growth pact."

The Council debated the economic and financial priorities of the Luxembourg Presidency and addressed the economic consequences of the tsunami in south Asia. The Council noted the presentations by the Commission and the European Investment Bank (EIB). The Council reached an agreement in principle regarding the facility proposed by the EIB and encouraged the latter as well as the European Commission to pursue discussion about the procedures to be used for implementing it after the needs have been analysed. The Council will revisit this issue and will review a proposal from the Commission when it is presented.

The Council ruled on the implementation of the excessive deficit procedures in progress.

For France and Germany, the Council took note of the communication by the Commission and supported the conclusion that it is not necessary at this time to take any formal steps in the excessive deficit procedure. It is expected that these two countries will be able to lower their deficit to less than 3% this year.

Concerning the Czech Republic, Cyprus, Malta, Poland and Slovakia, the Council stated that it was satisfied with the progress these countries have made in response to the recommendations submitted to them in July 2004. No action is required at this stage in the excessive deficit procedure.

As regards Greece, the Council adopted the conclusions and a decision under Article 104(8) of the Treaty, noting that Greece has not taken effective steps in response to the recommendations that the Council submitted to Greece in July 2004.

The Council adopted the same "Conclusions and 104(8) Decision" package for Hungary as it did for Greece. For Hungary, which is not a member of the Euro Zone, this is the final stage in the excessive deficit procedure. The Commission will submit a recommendation for a new recommendation under Article 104(7) in the context of the review of Hungary's convergence programme.

The Council adopted without difficulties its opinions on the stability and convergence programmes of the Czech Republic, Luxembourg, the Netherlands, Austria and Sweden. The respective texts will be made public.

The Council endorsed the annual report of the Economic Policy Committee (EPC) on structural reforms. This report will be forwarded to the March meeting of the European Council and will be used to draw up the Key Issues Paper that the "Economic and Financial Affairs" Council will prepare in order to update the Broad Economic Policy Guidelines (BEPGs) that will also be items on the agenda of the European Council meeting of 22 and 23 March 2005.




This page was last modified on : 19-01-2005

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