untitled design

20 Years of Euros – Joint article by Eurogroup members

The achievements of the common course of the single currency in their countries, but also the lessons from the economic crisis and the challenges for the coming years are examined, in a joint article, by the members of the Eurogroup in the context of the celebration of the 20 years of the euro.

The article is co-signed by the Minister of Finance Mr. Christos Staikouras, the President of the Eurogroup Mr. Paschal Donohoe, the Executive Vice President of the European Commission Mr. Valdis Dombrovskis, the European Commissioners Mr. Paolo Gentiloni and others. Mairead McGuinness and all the Eurozone Finance Ministers

Some thoughts on the 20 years of the euro

Like tomorrow twenty years ago, some 300 million Europeans held in their hands a brand new currency, the euro. From Lisbon to Helsinki and Athens, citizens had the opportunity to withdraw euro banknotes at local ATMs, shop in euros and travel abroad without changing currency.

The changeover from 12 national currencies to the euro was historically a unique undertaking of its kind: the European Central Bank issued more than 15 billion euro banknotes and about 52 billion coins were minted before 1 January 2002.

Taking advantage of the expansion of the single market, the euro has become one of the most tangible achievements of European integration, along with the free movement of persons, the Erasmus student exchange program or the abolition of roaming charges within the EU.

At a deeper level, the euro reflects a common European identity, which symbolizes integration as a guarantor of stability and prosperity in Europe.

As Finance Ministers and members of the European Commission directing the economic policy of the Eurozone, we look back at the last 20 years and set some priorities for the future of our common currency.

The last 20 years – the maturation

Admittedly, the first two decades of the euro were eventful.
From the great enthusiasm in its beginnings, the euro has become the second most widely used currency in the world. Our common currency remains hugely popular – around 80% of citizens believe the euro benefits the EU – and the Eurozone continues to expand: from 11 original members to 19 countries today, with even more to join in the coming years.

This progress has been made in defiance of serious challenges. The project was treated with caution by some while it was still in its infancy.

At around the age of ten, it became increasingly clear in the Member States and the institutions that the architecture of the euro was not designed from the outset to deal with the severe shock caused by the global financial crisis and the ensuing public debt crisis. This gave rise to the reform of the Eurozone governance framework, the creation of a common support mechanism for countries in financial difficulty and the introduction of a single supervisory system for European banks, in recognition of the need to find a solution through broader coordination and deeper coordination.

These first crises allowed the euro to mature and strengthen its international role. We also learned valuable lessons that were useful to us during the current pandemic, which knows no borders and highlighted both the degree of our interdependence and the strength of our unity.

When the scope of the COVID-19 crisis became clear, it was tackled with much faster, more decisive and coordinated policy action, in contrast to previous crises. Although existing tax and welfare systems have managed to mitigate the economic impact, the EU has taken unprecedented decisions to further protect life and income, complementing the ECB’s supportive monetary policies. Our collective response included the SURE financial support program, which helped protect some 31 million jobs, and the pioneering recovery plan for Europe, Next Generation EU.

Our coordinated policy response, combined with the availability of COVID-19 vaccines, has helped the Eurozone recover quickly from the economic impact of the pandemic. After all, the financial and liquidity support provided was designed to reduce the risk of long-term losses so that our economies could quickly regain lost ground.

The next 20 years

We have achieved a lot in the first 20 years of the euro, but more needs to be done.

We must keep pace with innovation and promote the international role of the euro. The euro itself must adapt to the digital age. That is why we support and contribute to the ongoing work of the European Central Bank on the digital form of our currency.

At the same time, the Eurozone needs to be further strengthened. Although our European banking system is based on strong foundations, we need to make further efforts to strengthen our banking union and offer new opportunities for economic recovery and growth. The same is true for our capital markets: we need to take decisive action to improve the way in which private investment and savings are channeled across the single market in order to give our businesses, including small and medium-sized enterprises, the financing they need and continue to create new employment opportunities.

Investment levels have remained very low for too long: we must invest in our people, our infrastructure and our institutions, and our investments must be massive and sustainable. Combined with responsible fiscal policies and the contribution of the private sector, Next Generation EU will play a key role in implementing many of the necessary reforms and investments. This is the best tool we have to boost our growth potential, improve our standard of living and meet the critical challenges facing humanity.

We must also ensure fiscal sustainability given the aging population. As part of our review of our common fiscal rules, we must ensure that the Eurozone fiscal and economic policies are appropriate for their intended purpose in a changing environment and that they meet future challenges.

Our common currency is an unprecedented collective undertaking, and testifies to the unity that underpins our Union.

As the world recovers from the pandemic, it is time to combine our efforts and resources to reap the benefits of a rapidly evolving world and manage the climate emergency. None of these issues can be addressed by countries acting individually. The euro is a testament to what we can achieve through cooperation; with a view to the next 20 years, let us make it a symbol of our commitment to a sustainable, prosperous and inclusive future for future generations.

* Article co-authored by: Magnus Brunner, Minister of Finance of Austria, Nadia Calviño, Vice-President and Minister for Economic Affairs and Digitalization of Spain, Clyde Caruana, Minister of Finance and Employment of Malta, Valdis Dombrovskis, President of the European Parliament Service of the People, Paschal Donohoe, President of the Eurogroup and Minister for Finance of Ireland, Daniele Franco, Minister for Economic Affairs and Finance of Italy, Paolo Gentiloni, European Commissioner for Economic Affairs, Pierre Gramegna, Minister for Finance of Luxembourg, Wopke Hoekstra João Leão, Minister of State and Finance of Portugal, Bruno Le Maire, Minister of Economy, Finance and Recovery of France, Christian Lindner, Minister of Finance of Germany, Mairead McGuinness, European Commissioner for Financial Services, Finance and Security Igor Ma tovič, Minister of Finance and Deputy Prime Minister of the Slovak Republic, Keit Pentus-Rosimannus, Minister of Finance of Estonia, Konstantinos Petridis, Minister of Finance of Cyprus, Jānis Reirs, Minister of Finance of Latvia, Annika Saarikko, Minister of Finance Andre Andrej of Slovenia, Gintarė Skaistė, Minister of Finance of Lithuania, Christos Staikouras, Minister of Finance of Greece, Vincent Van Peteghem, Minister of Finance of Belgium.

.

Source From: Capital

You may also like

Get the latest

Stay Informed: Get the Latest Updates and Insights

 

Most popular