By Martin Banks - 20th January 2009
The situation is clearly better than it was two to three months ago but the functioning of credit flows is not adequate and addressing this has to be a priority
EU economy commissioner Joaquín Almunia on finding a way out of the financial crisis
EU economic and monetary affairs commissioner Joaquín Almunia has called for an “exit strategy” stretching beyond the current financial meltdown.
Speaking at a news conference on Tuesday, the Spanish official also urged member states to adopt a coordinated approach to the crisis.
Almunia also said the commission was monitoring the various financial packages introduced in at least 17 member states to ensure that none create any distortions in international financial markets and achieve their intended goals.
His comments come the day after the commission warned that the eurozone economy will shrink 1.9 per cent this year and grow by only 0.4 per cent in 2010.
It said the whole EU was facing a “deep and protracted recession” and unemployment in the 16 countries using the euro is expected to exceed 10 per cent in 2010, up from 7.5 per cent in 2008.
Addressing journalists after a meeting of EU finance ministers in Brussels, Almunia said, “There was general agreement of the need to think of an exit strategy from the current economic crisis, one which allows us to look beyond this period of negative growth and lead to more efficient functioning of the financial markets.
“Everyone at the meeting agreed of the strong need for coordination, mutual support and for sustainable public finances and structural reform.
“There also has to be rigorous implementation of the structural and growth pact. This is key to regaining public confidence in the financial markets.”
Almunia, who is due to address parliament’s economic affairs committee later on Tuesday, went on, “The main concern, however, was the need to restore credit flows as soon as possible.
“The situation is clearly better than it was two to three months ago but the functioning of credit flows is not adequate and addressing this has to be a priority.”
He described as “very interesting” the latest UK plans for a further bailout of the banking sector, detailed at the meeting by UK finance minister Alistair Darling.
But he stressed that such a measure was not necessarily suitable for all member states.
Speaking at the same news conference, Czech finance minister Miroslav Kalousek said, “It is important that everyone feels bound by the long-term goal of fiscal consolidation.”
It was the first meeting of economic ministers since his country assumed the EU presidency on 1 January.
Have your say...
Please enter your comments below.