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22 March 2011

ECON committee: MEPs debate economic governance with ECB President Trichet


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A great deal of improvement needs to be done to draw all the lessons from the crisis, according to European Central Bank president Jean-Claude Trichet with regard to the latest plans to strengthen the coordination of economic policies within the EU.


On the occasion of their regular monetary dialogue with the ECB, members of the Economic and Monetary Committee quizzed Trichet on issues ranging from increasing inflation and eurobonds to bank bankruptcy laws and fiscal discipline.

In the discussions Mr Trichet said that opinion polls say that 80% of European citizens see effective and efficient economic governance in the EU as beneficial. That the European Parliament is also exercising powers with respect to this issue is very useful, he added.
 
The ECB president came out clearly against Eurobonds, however, explaining to French Liberal MEP, Sylvie Goulard, that such bonds would reduce incentives for governments to put their budgets in order. Answering a question from Jean-Paul Gauzès (centre right EPP, France), Mr Trichet said that investment expenditures must also count debt when calculating budget balances.
 
French Socialist MEP, Liem Hoang Ngoc, expressed fears that rising inflation could lead the ECB to raise interest rates and snuff out the economic recovery, while British Member, Vicky Ford (ECR), warned that differences in bankruptcy laws within the EU were making resolution of banking problems more difficult.



© European Parliament


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