-- Translation of advance text --

Ladies and gentlemen,

I’d like to bid you a warm welcome to this conference on “The Value of Europe”. The title speaks for itself.

For the European project this is a testing time. The debt crisis has turned into a crisis of confidence in Europe.

While self-confidence is increasing in other continents, self-doubts are increasing in Europe. That is something we have to change. Germany will not remain strong and well in the long term if Europe itself becomes the sick man.

Today we want to jointly focus attention on the fact that Europe is about so much more than interest rate spreads and rescue packages. Europe has its price. But, most importantly, it has its value, too.

Today’s united Europe is a community of shared culture, bound together by a common destiny.

Its fundamental values are the values which drove the European revolutions for liberty in 1789 and 1989: the inalienable dignity of every human being, the freedom of the individual, the protection of minorities by states based on the rule of law, and universal participation in democracy.

The Enlightenment is part of the foundation on which Europe is built. It was based on the belief that doubts and constructive criticism are not only permissible but also necessary in order to pave the way to more sensible and better solutions. We should remember that when we struggle to find the right course for our European project today.

The lesson that has to be learned from the crisis is that we need “more Europe”. However, we now have to create a “better Europe”. For that, we have to take criticism and critics seriously.

However, I’m also convinced that finding a sensible solution will not suffice. If we want to both gain and regain confidence in Europe, then we’ll require both common sense and enthusiasm.

Our actions in the debt crisis will determine how Europeans look in future at the European project: dissatisfied and despondent or optimistic and with self-confidence.

Today we’re shaping Europe’s image in a changing world. Without the determination to hold its own, Europe will gain the reputation of being an old and ageing continent which has fallen behind the new global players of our age. Europe has the strength and creativity to inspire people beyond its borders.

Finally, the time has come when how we regard each other in future as European neighbours will be determined. Now we’ll see whether a return of old resentments will lead us to drift apart or whether our community will grow closer together under the pressure of the crisis.

European integration has given us sixty years of peace, freedom and prosperity. At the same time, it is of immeasurable value to us in shaping Europe’s future. We are experiencing a seminal shift in the global balance of power. India alone will soon have three times as many inhabitants as the European Union. The relative influence of European states is diminishing. In future, we’ll only be able to get the world to take note of our values and interests if Europe is united.

However, we’re witnessing an increased focus on national interests in debates in our country. And we’re seeing a fundamentalization of views in other countries. These two elements are more closely connected than we want to believe at first glance. Both are dangerous reactions to our changing world. An excessive focus on national interests and fundamentalism are two sides of the same coin.

Protectionism and self-imposed isolation are economic folly and part of a problematic development within our societies. All of this jeopardizes our freedom. It jeopardizes our prosperity.

We have to find convincing answers to three questions during the coming months:

Firstly, what should we do to overcome the current crisis?

Secondly, what lessons have we learned that will secure Europe’s cohesion in future?

Thirdly, what kind of Europe do we want, what kind of Europe do we need beyond the crisis in order to master tomorrow’s tasks?

I.

First of all, we have to master the current crisis. We’ve already made considerable progress. The fiscal compact, the permanent stability mechanism and the growth pact have ushered in a fundamental paradigm shift in Europe.

The decision by the Federal Constitutional Court to pave the way for the ratification of the fiscal compact and the ESM is good news for Europe. With a little luck, this September may in retrospect be regarded as the turning point in Europe’s debt crisis.

Although the three-pronged approach of sound budget management, solidarity and growth doesn’t offer an easy quick-fix solution, it does address the root causes of the crisis. We’re tackling the excessive sovereign and private debts which have accumulated over many years. We’re addressing economic imbalances and the lack of competition in some parts of the eurozone. We’re rectifying the weaknesses in the architecture of our monetary union, which have come to light in the crisis.

This is beginning to have an impact. Ireland is on the right track back to the capital markets. Portugal has just achieved a surplus on goods and services for the first time in 70 years. Greece has drastically reduced its deficit and its exports have begun to grow. The crisis is not over yet. But these figures represent a ray of hope on the horizon. We in Europe must also take note of good news.

II.

Particularly in times of crisis it’s helpful to fix our sights on the horizon and the goal we’re heading towards. Not to distract ourselves from the task at hand but to ensure we stay on course.

That was the thinking behind the informal group of eleven European foreign ministers we convened in March. In months of intensive discussions we developed a set of joint proposals on the future of European integration.

Yesterday evening in Warsaw we outlined our ideas in a joint paper. Many of these proposals we’ve also discussed with the European Parliament. Over the next few days these proposals will also be presented to European Council President Herman van Rompuy and European Commission President José Manuel Barroso. Our intention is to encourage and contribute to what we feel is a necessary debate on these matters.

Our first priority here was to ask what kind of Europe we need, what kind of Europe we want. The question of how to build this Europe and what stages this might involve is one that should be explored in a second, later process.

Clearly, the top priority right now is to make Europe crisis-proof. Our monetary union requires well-conceived, closer cooperation in economic policy, financial policy and budgetary policy. This will mean a qualitative leap in European integration.

What we’re proposing is at European level to develop step by step an integrated economic policy framework. Working together in this way, we can generate new momentum for growth. One thing we need to do is complete our internal market. A truly European market for services could, of itself, add more than 100 billion euros to the EU’s GDP. Another thing that’s needed are joint European efforts to put our energy systems onto a new, viable footing. Yet another thing we need to do is seize the opportunities offered by the rise of new global players. We must move fast to forge strategic partnerships with them and conclude free trade agreements.

The crisis has revealed serious problems in Europe’s banking system. Over the past year cross-border lending has fallen by one third. This is a warning that must be heeded. A fragmentation of the European financial market is something we cannot allow. That’s why we want an integrated financial framework for Europe.

In future systemically-relevant banks should be supervised at European level, with the European Central Bank playing a key role.

Finally, Europe needs a more fully integrated fiscal framework. We propose that the European level should be given a greater say in the drawing up and control of national budgets. No member state must be allowed to act in a way that would undermine the monetary union’s solidity. Should this happen nevertheless, the Union must have the necessary authority and capacity to take action. That, too, will generate new confidence in the cohesion of the monetary union.

However, it’s my firm belief that introducing unlimited joint and several liabilities would create the wrong kind of incentives. It would impose excessive burdens on us and at the same time invite those countries that must now strain every muscle to carry out the reforms needed to turn their economies around to slacken their efforts.

What this means is anything but a “no” to European solidarity. Quite the opposite, in fact. The European Stability Mechanism builds the principle of solidarity into Europe’s structural fabric.

For such a monetary union strengthened along these lines, a fourth factor is of crucial importance. If the European level is to be given new competences, it must have matching democratic legitimacy. A Europe lacking due democratic legitimacy would be built on sand.

This means that in matters relating to the competences of the European Union, we must give the European Parliament its due role. But by the same token, the parliaments of the member states must continue to exercise their responsibilities and have the means to do so.

In matters of economic and fiscal policy we suggest there is a need to reflect also on new forms of parliamentary cooperation between the European and the national level.

It’s important that the debate on the future of Europe should be consistently conducted also as a debate on democracy in Europe.

III.

It’s crucial here that we don’t focus only on what must be done to make Europe as such crisis-proof. Even today we need to think further ahead. What kind of Europe will serve us best in a world whose political map is being redrawn?

European diplomacy must pursue a holistic approach that integrates the many different strands of European external action, from security policy to energy and trade policy, into a single whole.

We propose developing our European Security Strategy further into a strategy for a globalized world. For one thing, that would bring a common focus and direction to the pursuit of Europe’s interests vis-à-vis our strategic partners.

At the end of the road we’re now travelling there’s definitely one day going to be a Political Union. This would mark the completion of our economic and monetary union. And it would also make a Common Foreign and Security Policy a reality in the fullest sense of the word.

The foundations of this Political Union of the future must be a European separation of powers. That means a Parliament which enacts European laws. A Commission that functions as a European Government and whose President is directly elected. And a Council that serves as a second chamber and represents the interests of the member states.

Building this Europe of the future will take many years. And at some point down the road we’ll also need to have a new debate on a European constitution.

But even today reflecting on our post-crisis European future is neither sheer indulgence nor day-dreaming. Quite the contrary, in fact. Reflecting on the road we’re embarked on will help nurture a sense of where we’re heading and generate confidence in Europe.

Only in a united Europe can Germany look forward to a bright future. What’s crucial now is to take integration forward with unshakable resolve. That’s the message the Future of Europe Group wants to get across. The road ahead will demand from all of us a good deal. That’s why it’s so important for us Europeans gathered here today to remind ourselves that Europe is worth every effort.

Thank you for your attention.