Croatia’s intention to join the EU’s Exchange Rate Mechanism (ERM II)
In the margins of the Eurogroup meeting, representatives of the eurozone member states, the European Central Bank (ECB) and Denmark met in the presence of the European Commission and Croatia to discuss prospects of Croatia’s participation in the ERM II. They adopted a statement.
“Croatia’s intention to join ERM II shows that the eurozone is a solid anchor of stability and growth in Europe that continues to attract new members. I am convinced the eurozone will continue to grow in coming years.”
Eurogroup President Mário Centeno
The Eurogroup discussed the third enhanced surveillance report on Greece. The report is not linked to a decision on the policy contingent debt measures.
The enhanced surveillance framework for Greece was activated in July 2018 and entered into force after Greece’s ESM-financed programme ended, in August 2018. The enhanced surveillance reports are issued quarterly.
Eurozone fiscal stance
Ministers discussed the budgetary situation in the eurozone as a whole, focusing on prospects for 2020. The Chairman of the European Fiscal Board (EFB), Niels Thygesen, presented the EFB’s recently published report. The EFB advises the Commission on the prospective fiscal stance of the eurozone.
In addition, the Commission presented its assessment of the budgetary situation based on its analysis of the 2019 Stability Programmes and its Spring economic forecast. The discussion feeds into the preparation of the draft budgetary plans and the recommendations for the eurozone for 2020.
The Eurogroup is required by EU law to discuss the budgetary situation and prospects in the eurozone as a whole, in the framework of the assessment of the draft budgetary plans of the eurozone member states. It therefore holds regular discussions on the eurozone fiscal stance.
The Eurogroup also looked at the main findings of the 11th post-programme surveillance mission to Spain which took place from 7 to 8 May.
Post-programme surveillance (PPS) starts automatically after the end of a financial assistance programmes and continues until the country repays at least 75% of the financial assistance received. PPS missions take place twice a year.
International role of the euro
Ministers took stock of the outcome of the European Commission’s sectoral consultations and the latest economic analysis from the ECB as regards the international role of the euro.
The Eurogroup was informed about the Commission’s decision in the context of the spring 2019 round of fiscal surveillance for Italy.
Ministers welcomed the decision by the European Council to nominate Christine Lagarde as candidate for the next ECB President.
Deepening Europe’s Economic and Monetary Union
Ministers discussed the follow-up to the Euro Summit of June 2019, including ESM reform, banking union and the budgetary instrument for convergence and competitiveness.
Leaders invited the Eurogroup in inclusive format to continue working on all the elements of the comprehensive package on the strengthening of the EMU, as set out in the letter of the President of the Eurogroup of 15 June 2019. Ministers also discussed the organisation of the work in the next semester.
“We will strive to deliver coherent and meaningful solutions in the coming months. For that we need a spirit of compromise of all sides. The all-nighter of the June’s Eurogroup is still in our memory and there’s a lot of work ahead of us. I will continue to approach this in a constructive spirit.”
Eurogroup President Mário Centeno