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Deepening Europe’s Economic and Monetary Union

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Ahead of the Euro Summit on 21 June 2019, the European Commission today takes stock of the progress made to deepen Europe’s Economic and Monetary Union since the Five Presidents’ Report and calls on Member States to take further concrete steps.

In the four years since the publication of the report, marked progress has been made to strengthen the single currency area and make Europe’s Economic and Monetary Union more robust than ever. Many of the gaps revealed by the post-2007 economic, financial and social crisis have been addressed. Yet, important steps still need to be taken. The single currency and the coordination of economic policy-making are means to an end: more jobs, growth, investment, social fairness and macroeconomic stability for the members of the euro area as well as the EU as a whole. 

European Commission President Jean-Claude Juncker said: “This Commission has fought hard for the completion of the Economic and Monetary Union: a lot has been achieved but a lot remains to be done. This is about creating jobs, growth and social fairness for our citizens. It is about preserving the stability and resilience of our economies and it is about Europe’s capacity to take its future into its own hands.”

Ahead of the Euro Summit of 21 June, the Commission invites EU leaders:

To reach an agreement on the main features of the Budgetary Instrument for Convergence and Competitiveness with a view to supporting a swift adoption by the European Parliament and the Council. To agree on its size in the context of the Multiannual Financial Framework.

To finalise the changes to the Treaty establishing the European Stability Mechanism with a view to a swift ratification by the euro-area Member States, including an operational and effective common backstop, the provision of liquidity in resolution and active and effective precautionary instruments. To preserve a clear delineation of responsibilities between actors and the possibility to adjust the EU Single Rulebook for banks according to the Community method. To integrate the European Stability Mechanism into EU law over time.

To make a renewed effort to complete the Banking Union starting with political negotiations on the European Deposit Insurance Scheme.

To accelerate progress on the Capital Markets Union and step up work to strengthen the international role of the euro.

The Commission also reviews the main progress of recent years beyond the deliverables expected at the Euro Summit of June 2019 and maps out the way forward for the coming years.

Since the Euro Summit of December 2018, discussions have proceeded on the future Budgetary Instrument for Convergence and Competitiveness for the euro area, building on the Commission’s proposal for a Reform Support Programme; a compromise is within reach and should be taken forward with determination.

Discussions have also taken place on the reform of the European Stability Mechanism, in particular to provide for a backstop to the Single Resolution Fund in the form of a credit line. The backstop is expected to serve as a last resort to support effective and credible bank crises management within the Single Resolution Mechanism. It will be repaid via contributions from the European banking sector.

The completion of the Banking Union and Capital Markets Union (CMU) is also essential when it comes to bolstering the resilience and stability of the euro.

Significant progress has been made in further reducing risk in the Banking Union. The Commission’s latest progress report shows that the ratio of non-performing loans for all EU banks continues to decline and is down to 3.3% in the third-quarter of 2018, continuing its downward trajectory towards pre-crisis levels. Looking ahead, it is essential to progress with a common deposit insurance scheme for the euro area.

The CMU will foster further market integration and help ensure that Europe’s capital markets can withstand major internal or external challenges to the stability of the Economic and Monetary Union.

Encouraged by Leaders in December to continue its work on the file, the Commission also takes stock of the ongoing work towards developing the international use of the euro. The euro is twenty years young and is the world’s second currency, which remained strong even at the height of the financial and debt crisis. To understand better how to boost the global use of the euro – and to identify any obstacles to this – the Commission in recent months actively consulted market participants in different sectors (foreign exchange, energy, raw materials, agricultural commodities and transport).

These consultations showed that:

there is broad support for reducing dependence on a single dominant global currency;

the euro is the only currency with all of the necessary attributes that market participants seek to use as an alternative to the US dollar;

the energy sector will remain a key currency driver of use of the euro, with scope to further increase its use, such as in the gas sector;

there is recognition that the EU, through the euro, can reinforce its economic sovereignty and play a more important global role to benefit EU business and consumers.

The Commission, together with the European Central Bank, will continue to work with Member States, market participants and other stakeholders, and calls upon the European Parliament, the Council and all interested parties to support the efforts increase the international role of the euro.

Background

Almost exactly four years ago, President Jean-Claude Juncker, together with the President of the Euro Summit, Donald Tusk, the then-President of the Eurogroup, Jeroen Dijsselbloem, the President of the European Central Bank, Mario Draghi, and the then-President of the European Parliament, Martin Schulz, published an ambitious plan on how to deepen Europe’s Economic and Monetary Union (EMU) by latest 2025.

Building on the vision of the Five Presidents’ Report, the Commission followed up with the White Paper on the Future of Europe of March 2017, the thematic Reflection Papers on the Deepening of the Economic and Monetary Union and the Future of EU Finances in May 2017. In December 2017, the Juncker Commission set out a roadmap and adopted a number of concrete proposals with the overall aim of enhancing the unity, efficiency and democratic accountability of Europe’s Economic and Monetary Union by 2025.

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Zimbabwean peacekeeper selected as UN Military Gender Advocate of the Year 2021 Award

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Following reports of sexual and gender-based violence against women collecting firewood in Rubkona, South Sudan, Captain Irene Wilson Muro and and Major Winnet Zharare (2nd from the right) reached out to local women to discuss ways to stem the abuse. Photo: UNMISS

A Zimbabwean peacekeeper who recently completed her assignment with the UN Mission in South Sudan, will receive the 2021 United Nations Military Gender Advocate of the Year Award. 

Military Observer Major Winnet Zharare, 39, served in Bentiu, South Sudan in 2021-2022, and will receive the award from the Secretary-General António Guterres during a ceremony marking the International Day of UN Peacekeepers on Thursday, 26 May 2022.

Created in 2016, the United Nations “Military Gender Advocate of the Year Award” recognizes the dedication and efforts of an individual military peacekeeper in promoting the principles of UN Security Resolution 1325 on Women, Peace and Security, as nominated by Heads and Force Commanders of UN peace operations.

Secretary-General António Guterres commended Major Winnet for her award. “Major Zharare is a role model and a trailblazer. Through her service, she has demonstrated the invaluable role that women play in building trust, advocating for change and forging peace,” he said. “Her example shows how we will all gain with more women at the decision-making table and gender parity in peace operations,” Mr. Guterres added. 

Major Zharare expressed her gratitude and pride in receiving  the award which, she said, “motivated [her] to maintain [her] course towards gender equality.”

“My parents gave us equal opportunities with my brothers, so I believe that equal opportunities should be given to both men and women in all aspects of life,” she added.

Major Winnet Zharare deployed to UNMISS in November 2020. Throughout her 17-month-long service, she advocated for gender parity and women’s participation, within her own ranks, among local military counterparts, and in host communities.

As the Chief Military Information Officer in UNMISS’  Bentiu field office, she helped ensure that patrols included both women and men to improve protection efforts as well as build trust between host communities and the Mission. Her efforts also contributed to an increase in  gender-aggregated data so that issues raised by local women and girls would gain appropriate attention.

Advocating for gender parity and womens’ participation in an environment where they are traditionally excluded from decision-making, she encouraged local civilian and military authorities and community representatives to involve both men and women in meetings with the UN. Her diligence and diplomatic skills quickly gained her the trust of local military commanders who would systematically reach out to her on issues pertaining to women’s protection and rights. During her patrols and numerous community engagement initiatives, Major Zharare also successfully encouraged men and women to work together in farming and in the construction of dikes around Bentiu town to alleviate food shortages and prevent further displacement.

Major Zharare is the first Zimbabwean peacekeeper to receive this prestigious award.

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‘New dawn’ for Europe as War in Ukraine Strengthens EU and Support for Enlargement

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The European Union surprised the world, and even itself, with the speed, scale and unity of its response to Russia’s invasion of Ukraine. This “new” Europe is ready to project both soft and hard power on the world stage, European leaders told participants at the World Economic Forum Annual Meeting 2022.

Christine Lagarde, President, European Central Bank, on the panel at the session, European Unity in a Disordered World?, said the Ukraine war has revealed how powerful Europe is collectively: “This is a new dawn for Europe.”

The war on Ukraine has also revealed weaknesses – including global supply chain vulnerabilities and over-reliance on Russian energy, she said, but Europe is addressing this and can begin to flex its muscles on the global stage. “Europe has untapped purchasing power, trading power, technology power, pension power and moral power.”

Roberta Metsola, President of the European Parliament, reinforced the point. “This is Europe’s moment,” she said. “Europe can become the global project for peace.”

Mistakes of the past will be rectified, she said. “For way too long we did not seriously consider an energy union where we can rely on each other rather than on a country that can switch us off at any time.”

Referring to the EU’s support and defence of Ukraine, she was emphatic: “This is not the time to talk about face-saving for Russia or appeasement.”

Eduard Heger, Prime Minister of Slovakia, also on the panel, said: “If Ukraine falls to Russian aggression, Slovakia is next.” He added that we must continue to provide military support as well as step up humanitarian aid. “Above all we need to give Ukrainians hope.”

“Let’s not compromise – we must remain faithful to the values of the EU – freedom, rule of law, human dignity and equal rights.”

Micheál Martin, Taoiseach of Ireland, said of Russia’s invasion of Ukraine: “The people of Europe have spoken. Enough is enough.” In response there is much stronger unanimity between member states and more support than ever to accept the accession of new members.

He continued: “We see the EU’s future in terms of the green economy and in terms of the digitalization but also in terms of enlargement.”

Mark Rutte, Prime Minister of the Netherlands, called on European member states to continue to raise their defence spending. “The NATO alliance members are inseparable, but Europe must play its part,” he said. “This will help transform Europe from a soft power to a hard power.”

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Geopolitical Crises Forcing Leaders to Face up to Difficult New Realities

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Poland’s President Andrzej Duda delivered a harsh rebuke to Russia over its invasion of Ukraine, pledging “100% support” for President Volodymyr Zelenskyy and calling for Moscow to pay reparations to Kyiv. “I simply cannot accept that Russia can violate international law with impunity.”

Russian aggression against Ukraine has revived unity within the West and highlighted for many Western nations the importance of democratic values. Finland and Sweden, notably, have set aside their longstanding policies of neutrality and applied to join NATO. “We are in a totally new situation and have to wake up to that,” said Pekka Haavisto, Finland’s Minister for Foreign Affairs, noting that the collapse of the post-war European security architecture, as well as Russia’s increased appetite for risk, were among the major factors prompting Finland to apply for membership.

Haavisto said that in this “grey time” between the Nordic country’s application to join the alliance and its potential full accession, when it will enjoy mutual security protection under Article 5 of the NATO charter, NATO members have given Finland and Sweden assurances that they will guarantee security. Asked about Turkey’s stated objection to extension of membership to Finland and Sweden, he expressed confidence that Helsinki can address concerns.

Alarmed by an increasingly competitive geopolitical landscape marked by mounting frictions between the United States and China, Prince Faisal bin Farhan Al Saud, Minister of Foreign Affairs of Saudi Arabia, emphasized the need for cooperation.

“If we learned anything from COVID, it is that we need to focus on cooperation and I think we need to continue to look towards avenues to foster that cooperation. Even when there is difference, when there’s competition, we need to find mechanisms to talk to each other.” He noted that Saudi Arabia, which values both its extensive trade relationship with China and its national security relationship with the US, is well-positioned to facilitate dialogue between the world’s leading powers.

Prince Faisal’s remarks were echoed by Pakistan’s Minister for Foreign Affairs, Hina Rabbani Khar, who commented on the “binary choice” that countries with close ties to both China and the US are increasingly asked to make. “We are typically asked this question all the time: Who do you choose? It shows how far we have fallen as a global community,” she said. This is particularly difficult, she noted, for a country like Pakistan, which is already in fiscal crisis and now faces “the superimposition of a food security crisis”.

Gregory W. Meeks, Democratic Congressman from New York’s 6th District and Chairman of the House Committee on Foreign, praised the bipartisan support for a recent Senate bill pledging $40 billion in humanitarian and military aid to Ukraine, as well as the broad international support that Ukraine has received.

He also focused on the potential food crisis, emphasizing the need to break the blockade of Ukraine’s Black Sea ports so Ukrainian grain can be delivered to the many countries that depend on it. “You got to open [the port of Odessa] up because that’s not been just limited to what’s happening in Ukraine; this threatens the entire world.”

Madrid is host to next month’s NATO summit and Spain’s Foreign Minister, José Manuel Albares Bueno, praised the alliance’s response to Russian aggression in Ukraine. But he emphasized the threat that the looming food crisis, if left unresolved, could pose to Europe. Noting that the Sahel – the region of North Africa bordering the Sahara – is not only already deeply food-insecure, he warned that rising cereal prices could set off a potentially destabilizing northward migration. “Unity is our best defence.”

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