2023-09-16 18:54:28
PABLO R. SUANZES
SPECIAL DELIVERY
SANTIAGO DE COMPOSTELA
Updated Saturday, September 16, 2023 – 18:54
Calvio says that 70% of the work is done and he hopes to present a proposal for the agreement in October
Vice President Nadia Calvio addresses the President of the ECB, Christine Lagarde, in the Ecofin group photo, in Santiago de Compostela.AFP
Neither discussion about the candidates to preside over the European Investment Bank nor a formal proposal for an agreement on the reform of fiscal rules. The EU Economy and Finance Ministers met this week in Santiago de Compostela, and although at the beginning of summer expectations were very high and there was confidence in being able to put two of the most relevant issues on track at this meeting, the differences or the doubts are still too great. There are still five names on the table for the position he aspires to Nadia Calvio and with each passing day it becomes more difficult for there to be a new fiscal framework before it is removed from the induced coma in which it has been since the beginning of the pandemic. Stability Pact. Both processes have the same deadline, January 1, 2024. And now, ironically, both may become linked in an unwanted way.
The general feeling among the delegations of the 27 member states and the European institutions is that there is no material time to conclude the debate on time during the Spanish presidency. In the most optimistic calendar, which is in itself very ambitious, our country, which has the temporary presidency of the Council of the EU, would put on the table a proposal for an agreement in the next Ecofin, to mid-October in Luxembourg. From there, in just four weeks, there would be an agreement and the November Ecofin would be used to give the signature. Just in time to begin the negotiation with the Eurochamber in the so-called ‘trologues’, seeking the miracle of concluding everything before the end of December.
“It’s impossible. It’s not a drama, it’s not a failure, but It’s impossible at this point“, summarizes a European diplomat. “If they manage to present the proposal and the debate is smoothed out so that we can reach an agreement at the beginning of the year and everything can be settled before the European Elections, I will be satisfied,” says a second participant in the meeting. the vice president Valdis Dombrovskis In the final press conference I also mentioned that deadline as the ultimate objective for the new framework to be in place and serve for the fiscal guidelines and recommendations of each country in 2025.
But despite everything, Spain publicly maintains the faith. “We have already agreed on 70% of the text and we are going to propose to the ministers to move on to the political negotiation of the remaining 30%. With an adequate balance between a sustained reduction in the ratios of public debt over GDP […] accommodating the necessary investment and incentives to address structural reforms.” With these words this Saturday the first vice president of the acting Government, Nadia Calvio, summarized the state of the matter regarding the reform of fiscal rules, one of the most important debates. for the future of the Eurozone and perhaps the most relevant dossier of what remains of the Spanish presidency. We have an ambitious calendar for the new rules to be applied starting in 2024. It has been a day that can only be valued as extraordinarily positive,” he summarized. the Spanish
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Calvio wanted to leave his personal future in Santiago de Compostela resolved. To avoid scares, so that everything is not involved with the investiture attempts. But also to prevent the dossiers of the European Investment Bank and the fiscal rules end up spilling over. Several delegations explain that leaving the door open makes it possible for us to see additional complications. “If a candidate had emerged from this meeting there would be no problems. But now each capital can go to Calvio with the shopping list,” European sources explain to this newspaper.
A good example is Italy, which has presented Draghi’s former minister to lead the EIB. Daniele Franco. In the summer, when the Spanish woman stepped forward, they assumed that Franco had nothing to do, and a part of the Government suggested his name to fill a seat that would soon be vacant on the Council of the ECB. That idea was discarded, in favor of a technician who has finally been approved, so Franco returned to the EIB career. Not so much because he has opportunities but as a negotiating tactic. In exchange for Italian support come requests, also regarding the future of fiscal rules. And the same goes for everyone, especially Germany. The Spanish vice president needs Berlin. She has the sympathy of the socialist chancellor Scholz, but not from the liberal finance minister Lindner. Which can now push twice with its demands for objective annual adjustment numbers for the countries with the most deteriorated public accounts.
The idea of the reform of the rules is to make them more realistic, effective and tailored to each country. The spirit with which the European Commission designed them is to dispense as much as possible with equal adjustments for different countries, but Berlin encouraged that this initial proposal include a reduction in the deficit of at least 0.5% annually for the most indebted. France and Spain would want to erase that, but Germany would also want to add an annual debt reduction (in the model used until now a reduction of 1/20 is imposed each year). So the discussion is very delicate. It seems unlikely that there are no numerical objectives, but consensus formulas are being sought to square the circle: reduce risk without affecting growth. And Spain trusts that aid from Denmark or the Netherlands, historically falcons In this matter, a landing zone still to be defined was achieved. To begin with, these days contacts will multiply. In New York within the framework of the UN meeting.
At the beginning of October in Madrid, at the level of the technicians who prepare the Eurogroups. And, as presidential sources explain, it is not ruled out that there will be some additional Ecofin in the coming weeks, in person or videoconference, if necessary to press the accelerator. The commissioner Gentlemen He recalled from Santiago that his initial proposal is perfectly modifiable, but it must be done respecting balance. “We cannot modify in only one direction a proposal that needs to maintain together both the objective of financial stability and the objective of promoting investments and growth in a context of economic slowdown,” he stressed. “It will be a great challenge, but the Spanish presidency is committed. Maybe we can call it the Fiscal Path“said Vice President Valdis Dombrovskis in one of the many puns on pilgrimage and the Camino de Santiago these days.
The problem is maintaining that balance if different countries come with their lists of preferences or demands, or if they begin to put pressure on Calvio, who is responsible for trying to move forward, but is also at risk for a highly coveted and well-paid position. “Nothing similar is being proposed in any meeting,” the Spanish presidency rules out the possibility of partners who want to condition their support in the EIB to improving their fiscal aspirations. But everything being open only adds problems.
In this competition it is not a question of names, passports or political parties. For the EIB’s election, what the applicants can offer for the future of the institution counts. The four main axes are the position on the financing of green projects, key for Germany. The visin nuclear, vital for France, which wants the EIB to put a lot of money into the main part of its energy mix. The third element is the policy on weapons and ammunition. The Luxembourg-based Bank does not finance anything linked to weapons, but there are partners from the East who demand that this change. And finally, the ukrainian question. The fifth element, that of fiscal rules, was wanted to be avoided, but no one can guarantee that it will not end up playing some role.
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