Comments from euro zone finance ministers
Following are comments from euro zone finance ministers and other officials who gathered in Luxembourg on Monday for a meeting, with the agenda focused on the euro zone debt crisis.
EUROGROUP CHAIRMAN JEAN-CLAUDE JUNCKER
On Spanish and Portuguese fiscal consolidation measures:
The measures announced are significant and courageous.
On euro zone fiscal consolidation:
We will pursue fiscal consolidation beyond 2011.
On special-purpose vehicle for financial stability:
The facility has just been set up today in the form of a limited-liability company under Luxembourg law.
On talks with IMF Managing Director Dominique Strauss-Kahn:
We are sharing a common analysis of the importance of front-loading consolidation efforts.
IMF MANAGING DIRECTOR DOMINIQUE STRAUSS-KAHN
On Hungary:
I see no reason to be concerned. They will do what they have to do. I have no special concern.
On a possible earlier meeting with Hungary:
On our side, we are ready. It depends on the Hungarian government. I see no reason why it could not happen.
On the possible spread of Greek problems to other countries:
Today, the Europeans are going to complete the EFSF (European Financial Stability Facility) and that's a good step forward. But of course it takes time...Markets have to understand this, that the commitment of the euro zone countries with the help of the IMF is a strong one.
The mechanism that will be established by the members of the euro group is an important element of the stabilization of the system...So I think after some time things will come back to normal.
Fiscal sustainability is certainly an important thing for all countries, including in Europe ... But you have to differentiate your policies depending on the fiscal room that different countries may have, taking into account the balance between the face that you have to go back to the sustainable track on the fiscal side and the fact that you need to maintain the highest possible level of growth... So it leads to different actions in different countries.
Asked if the IMF was ready to contribute 250 billion euros to the EU assistance fund: The IMF has said it is ready to contribute to all the programs which the Europeans announced ... in proportion to their contributions (to the IMF).
GERMAN FINANCE MINISTER WOLFGANG SCHAEUBLE
We have a shared responsibility, we have a shared currency. The necessary steps must be taken. We need more efficient tools. We must decide what we change quickly within the framework of existing treaties.
He said they needed action on more efficient supervision, steps to take early action on cases where stability and growth pact rules may be broken.
It shows the development (in the euro currency) that we have to push ahead with what we have started. It is important that we get the special purpose vehicle underway.
BELGIAN FINANCE MINISTER DIDIER REYNDERS
A euro which allows one to be more competitive and helps to prepare exports better in the European Union is not a euro which poses problems.
What we must avoid is rapid and frequent fluctuations (ie in the euro's exchange rate).
FINNISH FINANCE MINISTER JYRKI KATAINEN
On G20 and bank levy:
It would have been very good if they had agreed on this issue. It is a little bit sad that they did not agree on that.
On euro zone enlargement:
We have to treat everybody similarly. If there is a country that fulfils all the criteria it should have the same right as we all have had.
CYPRIOT FINANCE MINISTER CHARILAOS STAVRAKIS
Certainly we are facing huge imbalances. The challenge is for the deficits to be reduced without leading to a recession, which would turn into a vicious circle in the sense that a further slow down reduces tax receipts and increases government spending.
JEAN-CLAUDE JUNCKER, CHAIRMAN OF THE EUROGROUP
I do not see any problem at all with Hungary. I only see the problem that politicians from Hungary talk too much.
I am not concerned about the existing level of the euro. I am concerned about the abruptness of the change.
AUSTRIAN FINANCE MINISTER JOSEF PROELL
Today we will consult intensely on how we will further develop the special purpose vehicle into a safety mechanism to back up the euro.
Asked if Hungary's debt situation posed a risk for the euro zone, he said: I do not think that Hungary can present a danger.
DUTCH FINANCE MINISTER JAN KEES DE JAGER
What we do see is that the present exchange rate of the euro is at about its historic average. Other economies in the world have a higher debt and a higher deficit than the average of the euro zone.
We should look also at markets such as the United Kingdom, the United States and Japan which have both higher debts and higher deficit levels.
Of course Europe has to do its part. We need to consolidate and we need to frontload. But do I have big concerns about the sustainability of the euro zone? No, I don't.
OLLI REHN, EUROPEAN COMMISSIONER FOR ECONOMIC AND MONETARY
AFFAIRS
I am confident we will have an agreement today on the SPV (special purpose vehicle).
We will have substantial discussion on the fiscal exit strategy because it is evident that many countries need to accelerate fiscal consolidation. Some are in the process of doing so, such as Spain and Portugal.
I concur with Jean-Claude Juncker that it is the pace of evolution (of the euro exchange rate) and not the level that is of concern.
Asked if Hungary is becoming a new Greece, he answered: No.
The main challenge is to boost confidence.
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