In his speech at the OECD seminar, Dijsselbloem emphasised the importance of structural reforms to increase growth potential.
After the immediate crisis response and the strengthening of institutions and economic governance, restoring economic growth is on the top of Europe’s policy agenda. Growth is necessary for sustainable public finances and the preservation of the European social model. Several countries have already undertaken impressive reforms. But there is still considerable scope for further efforts in a wide range of areas and a sense of urgency is crucial for achieving more results.
According to President Dijsselbloem, Europe should now begin a new phase and take a more offensive approach to boost growth. "First of all we can strengthen growth in the eurozone if we jointly work on competitiveness. And secondly, parallel to specific national policy changes, coordinated joint reforms with single standards can push our agenda further." After having developed common standards and joint cooperation in the banking sector, similar joint reforms could be conducted in other crucial sectors of the economy such as protected professions in services markets for example.
"The same mechanism we now have developed for our budgets, which last November proved to be effective when tested for the first time, could be used to create political leverage to improve the eurozone's competitiveness", Dijsselbloem suggested. "We, as Finance ministers, have worked closely and successfully together in the Eurogroup to stabilise and strengthen the Economic and Monetary Union. Together with our colleagues from employment policy and competitiveness policy, we could work with them side by side. And here I repeat my earlier plea: leniency on budgetary targets could be granted in combination with countries pushing forward reforms."
Dijsselbloem concluded: "Europe has been a convergence machine. The crisis has caused a setback in this process of convergence. But now, we should try to start that engine again. It takes a joint effort, to do what our people expect us to do; to push for more growth and jobs. It is a challenging discussion. It has economic aspects and strong political aspects. But it is a discussion that is crucial to the future of the Economic and Monetary Union."
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