Toespraak Van Rompuy tijdens Open Dagen 2012 over toekomstige Europese uitdagingen op nationaal en regionaal niveau (en)

EUROPEAN COUNCIL THE PRESIDT

Brussels, 8 October 2012

EUCO PRESSE 417 PRPCE 156

Herman Van Rompuy i President of the European Council Speech at the Opening Session of "Open Days 2012 10th European Week of Regions and Cities.

It is a pleasure to speak here today at the opening of your 10th Open Day. This is the largest event in Europe devoted to regional and urban development. With 6000 participants expected in over 100 workshops here in Brussels together with nearly 400 local events in 38 countries across Europe, this is a unique space for regional stakeholders to share their views and experiences. Regions and cities often lead the innovation of new policies. You have first-hand experience of what works and what doesn't. Sharing that experience is essential

I know how engaged you are in dealing with the challenges faced by European citizens, not least those that arise from the economic crisis, which you witness day-in, day-out. You also play a role in raising public awareness of what is at stake, and that in itself is crucial to success

Among the lessons we have learned from this economic crisis is the lesson of interdependence — not just between our countries but also within them between different levels of government and of public action. And I'm not just referring to the sustainability of public finances, where the links between regional and national and European levels are evident, but also to policies, and in particular policies for growth

We all share one clear objective: for Europe to remain an attractive continent in which to live and work, create wealth and spend it, for all citizens. For this, we need growth — "quality" growth! And an environment of social dialogue, cohesion and fairness!

Since 2008 Europe has faced two interlinked crises - the banking crisis and the sovereign debt crisis related also to an economic and social crisis. They could have had incredibly disruptive effects well beyond even what we have seen — and heaven knows that the crisis sparked real hardship in certain countries! But overall these effects were contained, because public authorities stepped in, and are still stepping in. Helping out countries in financial difficulty, helping out banks and regulating them more effectively, helping employers and workers to bridge the period of tension. In short, absorbing the shocks. Not without difficulty and controversy, and not yet a task that is completed, but an effort without which our continent would have faced catastrophe

In this context, I would underline that fiscal consolidation is not an objective in itself, but that it is a necessary condition for growth and jobs when the debt dynamic turns vicious. When that happens interest rates increase, demand falls and growth suffers. And that's precisely the situation in some countries today. The issue is how to do the consolidation, which is unavoidable, in an intelligent and social way, in a way that restores confidence and creates the conditions for growth to resume

Structural reforms are the main lever at our disposal. Most countries have engaged in deep structural reforms to raise competitiveness, investment and employment. We have learned that those who did this in the past (such as Germany a decade ago and Sweden and Finland two decades ago), withstood the crisis more easily than others

Courageous reforms are now underway across Europe. Going against vested interests, of all kinds: in the financial world, in the energy sector, in the labour market, in the sheltered services. Social fairness can only be achieved when the efforts and sacrifices are spread evenly. It helps to learn from each other. We are now well aware that the failure - or the success - of one country, can change the outlook for all. But, equally, some of the work to provide a growth-friendly environment we can only do together, at EU level

Take the single market, our unrivalled achievement, where we can still achieve more through integrating our energy, service and digital markets. A first package of deepening the single market is now being finalised in Council and Parliament, looking inter alia at professional qualifications, accounting , procurement and venture funds. The Commission will propose this month a second package of 12 further key actions

Or take trade, securing new markets for our companies abroad. Provided it takes place on a level playing field, international trade is a vital engine for growth. We are currently negotiating FTA's (Free Trade Agreements) with a lot of countries

Take mobility and training: despite high unemployment, there are more than 2 million vacancies in the Union. We should do to work, what "Erasmus" has done to studies!

And take finance. Here Europe can contribute, firstly, through its regular budget. Even if this represents only about 1% of our GDP, it does amount to around €1 trillion over seven years and which can have huge effects in terms of leverage. It enables investments with a Europe-wide growth potential which otherwise would simply not be possible

EUCO

That is why I want to settle the issue of the Union's Multiannual Financial Framework at a special summit in November. This is a political challenge, in that it needs the unanimous agreement of every Member State and the consent of the European Parliament. Yet, this has now been discussed at various levels for over a year. The remaining divergences concern an amount that comes to less than 0.1% of GDP. It is surely within the capacity of the 27 heads of state and government to find a compromise on this amount, which is much smaller than those that have been at stake in other recent discussions. We need an agreement on the MFF in November. A failure would mean a failure for jobs and growth!

Besides the budget, we have the European Investment Bank, the biggest multilateral bank in the world. It isn't very well known by the wider public, although I suppose many of you know it as a partner in developing important infrastructure projects. The recently agreed €10bn increase in its capital will expand its overall lending capacity by €60bn, supporting new investments up to €180bn

Let me now turn to the role of Regions. They are important economic players. For instance, just those European regions with legislative powers spend in their budgets around €800 billion a year. This is clearly crucial for public services and for investment and growth strategies. Regions are also crucial in implementing the Europe-2020 agenda and in making good use of cohesion funding and structural funding to improve their economic potential

Of course, common European rules constraining national levels of deficit and debt are likely to affect regions. National governments which define these EU level rules must ensure that their regions are involved ahead of decision-taking, just as they will be in implementation. Regions must ensure that fiscal consolidation is carried out in a growth-friendly way. Local and regional authorities should be involved in defining and implementing the National Reform Programmes favouring growth and jobs. There is room for improvement in this regard. We are, after all, engaged in a joint effort of all levels of government: multilevel governance to deal with multifaceted challenges!

To conclude: the stakes are high and the choices are tough. We must shape change, otherwise it will be imposed on us. It is an exercise in making the right, future-oriented choices. Cuts and taxes need to be fair. Sacrifices should not be borne by one social group or generation

Europe needs more structural economic growth, and together we can deliver it. But, of course, reforms take time to produce results. We must tell the truth to our citizens and explain again and again what we are doing. We need to convince them with sound arguments, facts and positive results

For that, we also need a positive language on Europe. There is enough negativism. There is enough fear. We need a language of hope. Hope can help shape change. We did it in the past. We must be the masters of our own future!

EUCO