Press Releases Remarks by Paschal Donohoe following the Eurogroup meeting of 15 September 2023

Remarks by Paschal Donohoe following the Eurogroup meeting of 15 September 2023

Today, we had a really useful Eurogroup meeting. It was great to be back with all of our colleagues in this inspirational setting where we all thanked Nadia Calviño for her hospitality and for the wonderful welcome that we have all received.

Most of the meeting was taken by an extensive exchange of views with regard to economic developments. It is a varied picture across the euro area. Here in Spain, the momentum is still good, but in other countries, we are seeing a change. It’s also a varied picture with regard to the services sector and the industrial sector in differing economies.

After listening to the Commission and the ECB presenting their latest forecasts, it is clear that the euro area economy has lost some growth momentum as a number of past shocks and of course, recent policy decisions are feeding through. However, let me emphasise that the overall resilience of the euro area is still very clear. It’s demonstrated most strongly by the continued performance of the labour market within the euro area – by so many people in so many parts of the European Union still being at work despite the many challenges that we’ve had to deal with. And while of course there is always the urge to focus on the latest figures and the latest forecast, that picture of overall resilience in the face of many great challenges still needs to be made.

In our discussion today, we had a particular focus on the medium-term economic performance, on our competitiveness, and on the sustainability of public finances. And against this backdrop, our July Eurogroup statement is still relevant and continues to be endorsed by ministers. Fiscal policy should be prudent, it should be careful, it should pursue a restrictive stance and it needs to work in alignment with changes in monetary policy.

So following the discussion that we had on the economic outlook, we moved on to the selection process of a new ECB Executive Board member to succeed our great colleague, Fabio Panetta, following the call for candidates which I launched at the Eurogroup meeting in July. Today, the Eurogroup supported the candidacy of Piero Cipollone, who is the Deputy Governor of the Bank of Italy, to become a member of the ECB Executive Board. A formal press statement was issued already today.

The Council is now expected to formally recommend his candidacy to the European Council so that the new board member will, hopefully, be able to take up his duties on 1 November 2023.

We wrapped up our meeting with a short exchange on the ratification of the ESM treaty, so our colleague and Italian Finance Minister Giancarlo Giorgetti could inform us of the latest developments that took place in the summer and the next steps for the parliamentary process in Italy.

Let me note that if Italy does not proceed with the ratification, it is not only Italy that will not benefit from the safety net that the ESM will provide, but this will not be possible for the whole euro area. I trust that the Italian authorities will continue to do their utmost to deliver on this important commitment.

Pierre Gramegna, the managing director of the ESM, briefed us on his recent work, and with that, we came to the end of our agenda.


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