The Internal Evaluation Office (IEO) of the IMF on Thursday night 28 July has published a highly critical report on the institution's participation in the Greek bailouts. The report on the role of the IMF in the Greek, Irish and Portuguese crises comes at an important moment, as the IMF is still formally to decide on […]Read More..
News & Comments
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The European Commission, making use of discretionary powers it has under the Six Pack of economic governance legislation, recommends not to impose fines (technically: to impose fines of zero euro) on Spain and Portugal because of the fiscal efforts both countries have made (although not meeting the targets) and the social challenges they are facing. The […]Read More..
EP President Schulz told the European Commission on 20 July that his institution wants to have a say in a decision to suspend structural funds for Spain and Portugal, following the Council's decision of 12 July that both countries have failed to take effective action under the excessive deficit procedure. See the news coverage by Euractiv: http://www.euractiv.com/section/euro-finance/news/meps-step-in-to-ease-sanctions-over-deficit-rules/Read More..
Both countries have submitted to the Commission their arguments for only imposing symbolic sanctions, after the Council had decided on12 July thar Spain and Portugal had failed to take effective action on the Council recommendations of June 2013. According to the SGP rules, both countries had a week to convince the Commission not to impose a […]Read More..
In an unprecedented decision of 12 July, the ECOFIN Council has decided, in line with the Commission recommendation of 7 July, that both Spain and Portugal have failed to take effective action under the excessive deficit procedure. This is the first time the Council has taken such a decision under article 126(8) TFEU, setting in motion […]Read More..
Amidst talks between Brussels and Rome about possible recapitalisation of the Italian banking sector, suffering from a high burden of non-performing loans and the impact of the UK referendum on Brexit, as well as the application of European state aid rules, the IMF has published its 2016 Article IV consultation on Italy. Read the full […]Read More..
7 July: Commission recommends Council decision establishing no effective action by Spain and PortugalJuly 7, 2016
The European Commission has adopted two recommendations to the Council establishing that both Spain and Portugal have failed to take effective action in light of their respective Council recommendations of 21 June 2013. Should the Council take over the recommendation of July 7, the Commission will have to propose what consequences it should have in […]Read More..
Italian bank Monte dei Paschi di Siena has received a draft-letter from the ECB setting out instructions to reduce its exposure to bad loans. The Italian bank has been given until 8 July to present its arguments to Frankfurt. Read the press release of Monte dei Paschi di Siena confirming the letter here. On the […]Read More..
A week after the UK referendum on EU membership, the ADEMU Horizon2020 research project has organised a webinar on three pressing questions: 1) Should the EMU be accelerated to become a centre of gravity within the EU, or slowed down to avoid a centrifugal diaspora? If accelerated, how? 2) Should an ‘exit’ country be allowed […]Read More..
The ECB Governing Council has decided to reinstate the waiver of minimum credit rating requirements for marketable instruments issued or guaranteed by the Hellenic Republic, subject to special haircuts. This means they can now again be used as collateral in Eurosystem monetary policy operations. It also means that purchases of Greek bonds by the ECB […]Read More..
The German Constitutional court has rejected the complaint the constitutional complaint against the OMT programme of the ECB, after its first preliminary reference ever. Notwithstanding the critical position already taken in its reference, and its criticism of the European Court of Justice's decision in the Gauweiler case, the Bundesverfassungsgericht finds the outcome "acceptable because on […]Read More..
ECB Governing Council member Ignazio Visco, and Governor of the Bank of Italy has said in an interview to Italian newspaper La Repubblica that: "A British vote in favour of leaving the European Union is the risk that worries us the most at the moment. (…) We are keeping an eye on this risk day […]Read More..
On 17 June the Board of Directors of the European Stability Mechanism (ESM) authorised the second tranche of €10.3 billion of ESM financial assistance to Greece. It also authorised the first disbursement of this second tranche of €7.5 billion to Greece. Greece will use the €7.5 billion to meet debt servicing obligations and to help […]Read More..
The 17 June ECOFIN Council adopted the following Council conclusions on a roadmap to complete Banking Union: "THE COUNCIL OF THE EUROPEAN UNION: 1. RECALLS that major steps have been taken at unprecedented speed over the past years to establish the Banking Union. After a comprehensive assessment of all significant credit institutions in the Banking […]Read More..
At the ECOFIN Council of 17 June the excessive deficit procedure was closed for Cyprus, Ireland and Slovenia. These Member States will now again be subject to the preventive arm of the Stability and Growth Pact. Read the relevant press release here. The ECOFIN also approved draft recommendations and opinions on the member states' economic […]Read More..
17 June: ECOFIN endorses draft recommendation on the establishment of national productivity boards within the euro areaJune 17, 2016
The ECOFIN Council of 17 June endorsed the draft recommendation on the establishment of national productivity boards within the euro area. The draft recommendation will now be submitted to the European Council for its June meeting, and subsequently referred for adoption by the Council. Check the main results of this ECOFIN meeting here.Read More..
At the Eurogroup of 16 June, IMF Director Christine Lagarde has again advocated the creation of a fund to help finance structural reforms in the euro area. See the reporting by Reuters.Read More..
At its Annual Meeting on 16 June, the ESM Board of Governors has decided to mandate the ESM with an evaluation of closed EFSF and ESM financial assistance programmes. The mandate includes a study and comparison of all completed programmes rather than being a country-by-country analysis. An evaluation team is tasked that will have appropriate […]Read More..
During a meeting of the Economic and Monetary Affairs Committe of the European Parliament review the Dutch Presidency of the ECOFIN Council, he remarked: "If we have an agreement between us, it is important that all of us comply. The role of the Commission is crucial when it comes to interpretation of flexibility rules and […]Read More..
The ECB in check: a case from Portugal on the new Single Supervisory Mechanism – by Nelson Coelho and Diane Fromage (Utrecht University)June 10, 2016
Nelson Coelho is a PhD Researcher at Utrecht University School of Law; Diane Fromage is an Assistant Professor at Utrecht University School of Law and co-author of the Report on France on this website (This comment first appeared on the blogdroiteuropéen, https://blogdroiteuropeen.com/2016/06/09/the-ecb-in-check-a-case-from-portugal-on-the-new-single-supervisory-mechanism-by-nelson-coelho-et-diane-fromage/) European Central Bank (ECB) Vice-President Vítor Constâncio was recently invited by the Portuguese […]Read More..
On Monday 30 May a joint meeting of the Committee on Economic and Monetary Affairs Committee (ECON) and the Committee on Budgets (BUDG) of the European Parliament discussed a draft report by Rapporteurs Berès and Böge that identifies three functions for a fiscal capacity: convergence, absorption of asymmetrical and of symmetrical shocks. The rapporteurs identify […]Read More..
Chris Koedooder is a PhD Researcher at the Amsterdam Centre for European Law and Governance (ACELG), University of Amsterdam. Late last year, the European Commission finally unveiled its proposal for a Council decision on unified representation of the Eurozone in the IMF. The proposal had been a long time in the making. It followed […]Read More..
The Eurogroup of 25 May 2016 welcomed the staff-level agreement between Greece and the institutions in the first programme review and considered the sustainability of Greek public debt. Read the full Eurogroup statement here. On the important issue of debt relief, the statemen reads: "In line with the 9 May Eurogroup statement, and in view […]Read More..
On Monday 23 May, one day before a Eurogroup meeting devoted to Greece, IMF staff has published a report with a critical preliminary debt sustainability analysis of Greece. The report was distributed to the IMF Executive Board in the morning, but – the report explicitly mentioned – was neither discussed nor approved by the same […]Read More..
23 May: German Centre for Economic Studies publishes critical analysis of excessive deficit procedureMay 23, 2016
Only a few days after the European Commission has proposed to give both Spain and Portugal more time to correct their excessive deficit, the German institute of economic studies CESifo has published a critical study of the excessive deficit procedure, including an overview of past violations, concluding that 114 out of a total of 165 […]Read More..
In its 2016 European Semester Country Specific Recommendations on 18 May 2016, the European Commission has proposed to give both Spain and Portugal an extra year to correct its excessive deficit under the excessive deficit procedure: "As regards Portugal and Spain, the Commission recommends to the Council to recommend a durable correction of the excessive […]Read More..
In an attempt to secure IMF participation in the 3rd Greek assistance programme, the Eurogroup of Monday 9 May agreed that: "In line with the statements of the Euro Summit and the Eurogroup in the summer of 2015, the Eurogroup stands ready to consider, if necessary, possible additional debt measures aiming at ensuring that Greece's […]Read More..
After several failed attempts to form a government after the Spanish Parliamentary elections of 20 December 2015 – in which no party secured a majority – new elections will be held on Sunday 26 June 2016 following a decision by the Spanish King to dissolve Parliament. This decision comes amidst rumours that Spain might become […]Read More..
Read a summary of the judgment of the Court in French or Dutch. Read also the full jugdment in French, German, or Dutch.Read More..
The debate of 28 April followed the signing of a petition by 53.000 people, forcing the Finnish Parliament to hold the debate. The petition also demands a referendum on euro area membership, but that is to be decided by Parliament. See the news coverage by Reuters and Il Sole 24 ore.Read More..
On 26 April a joint meeting of the Committee on Budgets and the Committee on Economic and Monetary Affairs held a discussion in preparation for the non-legislative report on a budgetary capacity for the Eurozone, a report that is meant to look at consequences for the EU budget, complementarities and parliamentary control. Read the draft […]Read More..
No agreement was reached yet on either the conclusion of the first review of the Greek programme or – with the IMF in particular – on debt sustainability. Instead it was agreed that in the coming days a special contingent package of additional measures should be negotiated, that would be implemented only if necessary to […]Read More..
Is the IMF necessary for the 3rd Greek Program? – by Alexandros Kyriakidis (University of Sheffield)April 20, 2016
Alexandros Kyriakidis is a PhD Candidate at the Department of Politics of the University of Sheffield Tensions have been growing between Greece and the IMF, including a highly controversial Wikileaks leaked conversation between the IMF Mission Chief for Greece and the Head of IMF’s European Department that raised issues at the highest level, with letters […]Read More..
In a report published on 19 April 2016, the European Court of Auditors is critical of the way the European Commission implements the excessive deficit procedure, and argues that the application lacks consistency and transparency and that the Commission does not adequately record its underlying assumptions or share its surveillance findings for the greater benefit […]Read More..
A team from the European Commission, in liaison with staff from the European Central Bank (ECB), carried out the fifth post-programme surveillance visit to Spain on 11-13 April 2016. The European Stability Mechanism (ESM) participated in the meetings on aspects relating to its early warning system. The mission was limited in scope, and mainly focused […]Read More..
After an invitation from Greek Prime Minister Tsipras, the European Parliament has created a Working Group within the ECON Committee, to strengthen its efforts to ensure a strong parliamentary scrutiny of financial assistance programmes. The first fact-finding mission of the ECON Working Group took place in Athens on 30 and 31 March 2016. The delegation […]Read More..
In a joint declaration left-wing Prime Ministers Costa and Tsipras of Portugal and Greece expressed their dissatisfaction with the EU anti-austerity policy.Read More..
Read the introductory statement of ECB Vice-President Vítor Constâncio here.Read More..
Having exited the financial assistance programme, many rules of the economic governance framework again apply also to Cyprus. This includes the macroeconomic imbalances procedure, and in fact the European Commission on 7 April published its 2016 Country Report on Cyprus including an in-depth review on the prevention and correction of macroeconomic imbalances.Read More..
On 31 March 2016, Cyprus has exited its financial assistance programme, three years of it had agreed to the programme in March 2013 (after an initial request in June 2012). This means Cyprus is now again subject to many rules of the normal EU economic governance framework and also subject to post-programme surveillance (PPS) until […]Read More..