A growth pact for Europe

In the policy statement he issued on 11 May, Foreign Minister Guido Westerwelle emphasized the Government’s equally strong focus on both budgetary discipline and growth policy as means of overcoming the sovereign debt crisis in Europe. “Our efforts are both pragmatic and far-sighted; we are fighting for Europe with our hearts and with our heads,” he said.

Regaining confidence

The Foreign Minister underlined the need for the people of Europe now to demonstrate that the eurozone would in future offer lasting financial stability. Only then, he said, would people once more have confidence in individual euro countries proving able to pay off their in some cases enormous debts. Pointing to the strengthened Stability and Growth Pact and the fiscal compact for less debt, Westerwelle expressed confidence that the right steps had been taken.

Budgetary discipline and growth

Westerwelle declared that equal weight had to go to budgetary discipline and growth brought about by greater competitiveness. He placed the onus first and foremost on the member states themselves to undertake structural reform and thereby bring about the competitiveness which would lead to growth. However, he added, Europe also had to pull its weight: “At the European level too, we intend to place even more emphasis on growth.”

The six-point growth pact

Westerwelle spoke in favour of a European growth pact, which would encompass six points as follows:

Flying the flag for growth in Europe

Flying the flag for growth in Europe
© picture-alliance / dpa

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Flying the flag for growth in Europe

Flying the flag for growth in Europe

Flying the flag for growth in Europe

Firstly, Westerwelle said the European Union would have to use its funding “better than before”, without spending more. With the EU budget for the 2014-2020 period planned at more than a trillion euros, the structural funds contained in that sum would have to be directed towards encouraging growth and competition in Europe, he insisted. This, Westerwelle said, was about shaping the future, which was what politicians owed the taxpayers of Europe. The Government, he said, had therefore put forward an action plan for better spending in the budget negotiations in Brussels.

Secondly, he said, the European Commission had to take the remaining money from the European Funds – around 80 billion euros – and use the money now already to boost competitiveness in the member states.

The third point Westerwelle gave was that the credit crunch currently affecting small and medium-sized enterprises in Europe had to be overcome. SMEs, he said, needed better access to loans, and the European Investment Bank had the expertise to be useful in this regard.

Westerwelle’s fourth point involved developing Europe’s cross-border infrastructure, including the road, rail, energy and telecommunications networks. Doing so would mean exploring the option of funding through public-private partnerships, Westerwelle said.

Fifthly, Westerwelle said that the internal market had to be extended to include the digitized economy, online trade and the energy sector.

The Foreign Minister’s sixth point referred to strengthening free trade. Until progress towards a global free trade system could be made in the Doha Round, it was up to the EU, Westerwelle said, to conclude free trade agreements with the new and the long-established centres of power on the world stage.

Last updated 11.05.2012

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