A facility providing financial assistance for Member States' balances of payments - Financial support to Member States (debate)
The next item is the joint debate:
on the report by Mrs Berès, on behalf of the Committee on Economic and Monetary Affairs, on the proposal for a Council regulation amending Regulation (EC) No 332/2002 establishing a facility providing medium-term financial assistance for Member States' balances of payments - C6-0389/2008 -;
the Commission statement on financial support to Member States.
rapporteur. - (FR) Mr President, behind this obscure title, each person is assessing the importance of the discussion we are holding this evening following Hungary's request for financing, which was first made to the International Monetary Fund (IMF). The European Union has looked at the issue to verify the conditions under which it could give its support to one of the Member States.
It is true that there was a discussion amongst the members of the Committee on Economic and Monetary Affairs as to why Hungary first approached the IMF. That is a question for Hungary as a country, as a member of the European Union of some years standing, and also for the institutions of the European Union in the sense that, manifestly, at this stage, we have been unable sufficiently to develop this climate of confidence, this climate of solidarity, this climate of cooperation to allow a country like Hungary, in its current difficult situation, to consider that its first circle of solidarity, its first circle of cooperation, should be the European Union.
I believe, finally, that the plan implemented for a balance of payments assistance facility, on the basis of Article 119, achieved on the initiative of the Commission and Mr Almunia, whom I thank, will allow an appropriate solution to be found jointly with the IMF.
Evidently, we all think now that, unfortunately, Hungary's situation is not an isolated case, and we must in some way consolidate the cushion which will allow the European Union to meet such requests.
In the resolution that we adopted in the Committee on Economic and Monetary Affairs and that I hope will be supported by plenary tomorrow, we ask the Commission to examine how and whether the banks of some Member States of the Union have helped to aggravate this situation. I believe that this is important information for the European Parliament to have in the coming debate, and which, doubtless, Jacques de Larosière's group will examine thereafter.
We have also said that we think, essentially, that the Council's proposal was to raise the level of the facilities to a given threshold, which we have accepted, believing that this, perhaps, will not be the last discussion we will have with the Commission. At this stage, we understand that this is the basis for agreement in the negotiations with the Council and, therefore, we accept this situation.
In the future, we hope that the European Commission, Council and Parliament will all regularly approve these amounts, because, in 2002, when the European Parliament voted on the Regulation we are now amending, we asked for a regular update to be organised. Evidently, and unfortunately, I have to say that we were right. We are now therefore asking you for it again, Commissioner, and I believe it is reasonable to ask that it be carried out in that manner.
Finally, in the Committee on Economic and Monetary Affairs, I asked for the tools and processes of Article 100 of the Treaty to enable us to act to support some Member States more widely, and not just on balance of payments problems. Unfortunately, I was not supported by the Committee on Economic and Monetary Affairs in this matter, but I am using my position as rapporteur to urge the Commission to examine this mechanism which the Treaty offers us and which, to date, we have failed fully to exploit.
Mr President, Mrs Berès, ladies and gentlemen, when the founding fathers of the European Union drafted the Treaty of Rome, they had the foresight to include, in one of its articles, a mechanism to help Member States whose balance of payments was seriously threatened.
That foresight in that article of the Treaty of Rome has been passed on through successive treaty reforms and is now in Article 119 of the current Treaty. After many years of non-use, this legal basis has now been used by the Commission to assist a Member State which needed urgent help, namely Hungary.
This article of the Treaty was developed in a 2002 Regulation which is what we have used in the case of Hungary and which is what we are now proposing to amend with regard to the maximum ceiling of the amounts that can be made available to help Member States facing this kind of difficulty.
Yesterday we debated in this House the ten years of Economic and Monetary Union. This afternoon we have debated the economic situation. Yesterday and again today we have discussed the problems caused by this situation and, unfortunately, there are some EU Member States which are outside the euro area and whose macroeconomic and financial imbalances are putting them in a particularly vulnerable position, given market pressures.
In the case of Hungary and in light of these difficulties, at some point the Hungarian authorities contacted the International Monetary Fund (IMF). Immediately after establishing contact with the IMF, they contacted the European Commission.
As I have said to the Hungarian authorities, this was not the right procedure for a Member State. The logical procedure is firstly to contact the European authorities and then, if necessary - and in the case of Hungary, it undoubtedly was - to jointly contact the IMF.
I must say to you all that the IMF and its Managing Director, Mr Strauss-Kahn, have proved to be absolutely open to this cooperation between the IMF and the European Commission, the European authorities and the EU Member States which are members of the euro area and need to access the facilities provided by the IMF.
In the case of Hungary, we have acted in cooperation. Although the procedure was not started correctly, the end result has been right as we have acted in cooperation. The European Union is providing Hungary with EUR 6 500 million within a global aid package worth EUR 20 000 million. This same approach, but in this case using the right procedure of firstly contacting the European authorities and then jointly contacting the IMF, is now being used in the case of another country.
Unfortunately, the situation is proving so difficult that this may not be the last case, or at least we should be prepared for there to be other cases, other Member States which need this type of help. That is why, at the same time as we presented the Council with the proposal to help Hungary, by using Article 119 of the Treaty and the 2002 Regulation, we also presented a proposal to raise the maximum ceiling of the facility established by the 2002 Regulation to EUR 25 000 million.
Hopefully we will not have to use these funds, but we cannot rule out this possibility. If we have to use them, then we must demonstrate our solidarity, as the founding fathers did in the Treaty of Rome in 1957, and we must also plan for a possible increase in the ceiling above EUR 25 000 million, if this proves necessary. As a result, I would ask Parliament, when discussing this issue in the future, if this proves necessary, to show the same willingness that I am pleased to witness here today. I would ask Parliament to give its opinion quickly and flexibly on help that, due to its very nature and characteristics, will be urgent.
There are elements in the motion for a resolution tabled by Parliament, together with the debate on the proposal to raise the ceiling of the balance of payments facility, with which I agree. These involve concerns about the vulnerability of some of our Member States and about the need to assess how we can protect ourselves and protect those Member States affected by this particular vulnerability, as in the case of Hungary, but which may also arise in the case of other countries.
We have to make this defence of the stability of Member States' economies and financial positions compatible with the free movement of capital and with the principles on which the internal market is based. However, we must be aware that we have to react to unnecessary risks and situations in which certain private interests may threaten the higher interests of Member State citizens and the economic and general security of our States.
I have taken due note of the suggestions made in this motion for a resolution. We will assess these in the Commission and report our findings to the Committee on Economic and Monetary Affairs. As stated by Mrs Berès, these will also be conveyed to Mr De Larosière so that his group can present its findings within the period set for its work, in other words by March.
on behalf of the PPE-DE Group. - (HU) Thank you for the floor, Mr President. As a matter of fact we are faced with a sad situation, since we need to debate a request for immediate assistance. I would say, however, that I can make a positive comment because the European Union has finally, after a lot of searching - which was far from easy - discovered Article 119 and the legal basis on which it can provide such assistance. For a long time, as the news wafting in from Hungary indicates, they could not find a legal basis for doing so.
Before going any further, let us examine the reasons for this. One reason is convergence - as we debated yesterday - or rather the lack thereof. In recent years, there has been no reinvestment in capital movements from east to west within the EU, and consequently there is an enormous capital drain from eastern Member States to the western ones. This means we face an ongoing imbalance of payments, which, moreover, will prevent true convergence.
The other problem is that obviously the surveillance system is incomplete, since the countries which do not use the euro can simply run up debts in foreign currency. If I have heard correctly, until now the European Union did not entirely have the power - though in my view it does have a voice - to tell these countries to 'be careful, do not allow the population and businesses to run up endless and irrational debts in foreign currency, because there could be trouble if there is a crisis', and so the problem has indeed arisen.
Therefore, surveillance must be extended to cover this, and should already have been extended long ago, for as I say, the Commission has a strong voice in Central and Eastern Europe, and can open its mouth.
The crisis has now arisen. The Hungarian Government first ran to the International Monetary Fund (IMF) out of fear, this we know, but they say that they did of course try to approach the EU as well, and that the latter tried systematically to find a legal basis. The government also say that they lack sufficient capacity to analyse the crisis. To this I say, let us create it. It should not be the case that everyone has to rely on the IMF whenever they need crisis analysis. What will the outside world think of us, if we try to use IMF funds to rescue Member States of 1-1.5 million inhabitants from an imbalance of payments?
A crisis mechanism will not work when a system, at times of crisis, has to stop a capital drain from a non-euro area country, for instance in the monetary sphere, for that is when the drain really begins to operate. Even the European Central Bank cannot do much, since in spite of coverage in forints, it does not really want to help with the liquidity problem, although all Hungary needed was foreign currency liquidity, since the banks were not heavily in debt.
As far as the Hungarian report is concerned, its 2006 analysis began with an improving situation. It reminds me a bit of Chernobyl in 1986, when on the first day they reported that there was no problem, and thereafter the situation was steadily improving. In the end we worried that there would be negative radiation. In this case as well, everyone is forgetting. We started out with what happened until 2006, and since then there has been a serious lack of surveillance of currency flows.
This EUR 25 billion ceiling, I would like to observe, seems very low. It includes from the outset that we want to work with the IMF, whereas it is hard to imagine a more terrorising situation than relying on the IMF.
It would be very important, of course, for the European Parliament to be involved and at the same time to act speedily. In my view, the two are now happening at once, and for this I am grateful to the Commission as well as to Parliament. I would, however, reiterate that we should create a mechanism which will prevent a recurrence of the various misfortunes that occurred in relation to the Hungarian crisis, and which has done nothing to increase the prestige of the European Union in Central and Eastern Europe. Thank you for the floor, Mr President.
on behalf of the PSE Group. - (HU) Thank you for the floor, Mr President. Commissioner, ladies and gentlemen, as I am not a member of the Committee on Economic and Monetary Affairs, please allow me to approach the question before us from a different perspective. Last year's financial crisis in America has reached Europe this year, and our financial markets, which we had believed to be stable, were shaken in their very foundations.
Instead of devising a unified EU solution, it was only after long hesitation that we were able to address the crisis with an individualised, harmonised response that is costing several billion euro per country. These individual national solutions cannot be the way to handle crises in the new EU Member States, which are unable on their own to move billions of euro. Initially, these countries trusted that, since their banks did not get involved in dubious, speculative overseas transactions, this international credit crisis might not affect them.
The lack of liquidity and crisis of confidence that accompanied the international financial crisis has, however, greatly shaken the finances of those States that rely on foreign credit, and the speculative attacks on national currencies further contributed to this turbulence. In this situation it was important for the new Member States to receive not only moral but concrete, tangible financial assistance from the European Union, and for the EU to extend its protection to those countries that have not yet joined the euro area.
This is not just solidarity, as inspired by the fundamental European value, but a shared European interest to avoid a domino effect by preventing even a single bank - not to mention an entire country - from becoming insolvent.
Bearing this in mind, we are now looking at raising the facility from EUR 12 billion to EUR 25 billion. In this context, the European Central Bank provided Hungary, which was most severely affected by the crisis on the money markets, with a rescue package of EUR 6.5 billion euro. This was a very fair and dignified solution, since Hungary has not only spearheaded reform and European unification for decades, but has also, since last year, halved its approximately 10% budget deficit, in accordance with the convergence programme adopted in 2006; that programme has been implemented systematically since that time, and the deficit this year is being reduced to 3%.
In order for the consolidation process required by the EU to continue, assistance is needed from international financial bodies. As a consequence of the financial and credit crisis, the entire world economy is now facing difficulties; yet individual EU Member States are trying to deal with these with their own instruments and in accordance with their own very specific goals. In order that the new Member States, which do not have such instruments at their disposal, should not lose out in the process, what is needed in order for Europe to weather the crisis jointly is not only to harmonise current actions but to adopt a common European strategy to deal with the economic crisis.
I hope that this financial rescue package constitutes the first rung on this ladder, and that once it has been adopted, we will be able to concentrate all our efforts jointly on solving the crisis of the real economy. Thank you for the floor.
on behalf of the UEN Group. - (PL) Mr President, speaking on behalf of the UEN Group on the Council Regulation establishing a facility providing medium-term financial assistance to EU Member States, I should like to draw attention to the following issues: first, the situation in world financial markets is having an increasingly adverse impact on the real economy, with the result that GDP is expected to fall in 2009 in the US and in many of the European Union's most developed states.
Second, since those countries constitute the main market for the new EU Member States, this threatens their economic growth and will therefore have an adverse impact on their balance of payments. Third, this being the case, we must definitely support raising the ceiling of Community financial assistance to EUR 25 billion for each Member State not in the euro area, because only a ceiling this high will guarantee the effectiveness of any assistance granted by the Community.
Fourth, should a Member State outside the euro area need immediate financial support, the Council, European Commission and Parliament should act with sufficient speed to prevent confidence in their effectiveness being undermined.
Fifth and last, we welcome the European Commission's rapid response to Hungary's financial needs, granted in spite of the fact that Hungary had in the first instance approached the International Monetary Fund and not the European Commission.
on behalf of the IND/DEM Group. - (SV) Mr President, Commissioner, ladies and gentlemen, when I read up on the subject that we are now debating, the balance of payments problem, I felt like Marcel Proust with his madeleine cake, In Search of Lost Time. There is an aroma of the 1950s and 1960s about the approach to the problem.
The balance of payments problem? This is something that we are to set aside EUR 25 billion for. Why on earth should we do this? Is this what we are doing today? This is intended for those countries, those poor countries, as I understand it, that are in the EU but not in the currency union and that may then need to be rescued from a fate worse than death: the balance of payments problem. This has, in that case, been created by the European Union itself, of course. What we are talking about here no longer exists in fact.
My own country, Sweden, is part of the EU and loyally supports it, implementing everything that is decided there much better than most other countries, but we have not joined the monetary union. Wisely so, in my opinion. However, if we should now experience problems in Sweden, will we then have a balance of payments problem? The answer is, of course, no. Naturally, it is possible to imagine that Sweden could start to mismanage its economy and experience a much higher rate of inflation and increase in wages than other countries. What happens then? Do we get a balance of payments problem? No, the Swedish krona falls to compensate for this. Nothing else happens at all. This is also the case in other countries in the same situation, for example in the United Kingdom.
What is the problem then? Well, the problem is that, if these countries are members of the European Union - which they should be - but are not members of the monetary union - which they should not be - then they are to be forced, as you intend, to keep a fixed exchange rate with the euro. The worst-case scenario is to be forced to keep a fixed exchange rate with your most important trading partners. It is clear that if a country mismanages its economy, experiences a higher inflation rate or suffers a structural setback in its most important export industry, its exports will decline and its imports increase. Suddenly the question is, how is this to be financed?
This is, however, a totally artificial situation. It is thoroughly old fashioned for countries that are not members of the monetary union to choose to fix their exchange rate and then need to be rescued by the International Monetary Fund or the EU or by anyone else. Why, for goodness sake, should this happen? It is a form of economic policy that is completely out of date. Either a country joins a monetary union - that could be right sometimes, I agree - or it remains outside, standing on its own two feet with its own independent monetary policy, and takes care of itself. If the country takes care of itself, nothing in particular will happen. If it mismanages itself, the currency will fall to compensate for that. This is not particularly dangerous, either.
I would therefore like to point out that, while we are discussing whether we should set aside EUR 25 billion for this purpose, it is a purpose that is actually not at all necessary. It is a problem that we have created ourselves, or rather you have created yourselves. Put an end to it. Those countries that are members of the EU but have not joined the monetary union should maintain a regime with a floating exchange rate. Then the problem disappears.
- (SK) The limit for mutual assistance to an EU Member State that is not a member of the euro area and that is experiencing balance of payment difficulties or is facing the risk of serious problems as a result of an overall disequilibrium in its balance of payments is currently EUR 12 billion. The examples of Denmark and Hungary show that the consequences of financial crises in some states can be so great that, if such a crisis occurred in a larger state, then this limit would be too low.
I would therefore like to stress that I do not consider the primary reason for increasing this limit to be either the expansion of the European Union or the greater number of states outside the euro area, as is stated in the explanatory report. We need to be aware that the financial problems in some Member States are mainly the result of inconsistent economic and social policies. These problems are aggravated and made more profound by the financial crisis, thereby creating pressure for increased levels of assistance. Hungary is just a typical example.
I support increasing the limit on medium-term assistance to EUR 25 billion. I also support, however, the opinion of the European Parliament that there is no need to create a special process allowing the Commission to revise this limit outside the usual decision-making procedures. I believe that such an approach will maintain high levels of diligence in the assistance system while also giving sufficient scope for action.
I mention this as Hungary is a textbook example, since its political leadership has been unable to decide on reform and recovery measures for a long time. In the final analysis, the adoption and implementation of such measures could also lessen the impact of the financial crisis in this country and reduce the need for financial assistance from the European Union.
On the other hand, however, I must defend Hungary over the fact that the new rules for financial markets must not allow excessive flow of liquidity from subsidiary banks to parent banks and that a sufficient level of supervision must be maintained over national central banks.
It is true that he who acts in haste may pay twice over, but it is also true that he who takes in haste will not always pay back on time or in full. It is therefore essential for the system to set out clear rules in respect of assistance, based on a regime of recovery measures which covers both schedules and matter-of-fact issues.
(PL) Mr President, Commissioner, may I begin by responding briefly to two statements made by fellow Members. First, I should like to point out that countries not in the euro area are not required to maintain a fixed exchange rate with the euro. Poland is an example of a country with a floating exchange rate. Second, I should like to say that even a country which has a perfect domestic policy and makes no mistakes could be affected by the crisis, due to the contagion effect. Of course, the Hungarian situation largely originated in incorrect government policy, but Hungary had also been affected by a flight of capital, which was not the result of the Hungarian situation, but had external causes.
Commissioner, I wish to support the Commission's proposal. It seems to me to take into account the fact that we are all in a single market, and that the situation of individual countries is of importance to the other countries. We should therefore be aware of the ties that bind us and feel a sense of joint responsibility for our partners. The proposal is also an expression of European solidarity, which should be among the main values underlying our actions.
The amount of EUR 25 billion proposed by the Commission seems reasonable, though of course there could be situations requiring more money, and therefore I also support the proposal to grant the Commission the right to decide to revise the ceiling where there is an urgent need to do so. It is my view that using the full procedure involving the consent of Parliament or a parliamentary consultation would be impractical in such circumstances. Let us suppose that a crisis occurs in the summer, when Parliament is not sitting. It is hard to imagine that we would wait six weeks for Parliament to convene before helping the relevant state. I therefore support the Commission's proposal granting it the right to raise the ceiling within a very short period of time.
May I also say that I see the proposal as lacking a reference to possible action on the part of the European Central Bank. The Bank granted a loan to Hungary. This action should be coordinated, and it is my view that a reference should be included. Finally, I think that the proposal should not refer to Article 100 of the Treaty. Article 100 deals with quite different situations and should therefore be treated separately.
(HU) Thank you, Mr President. Commissioner, Mrs Berès, it is precisely the principle of solidarity that makes Europe more than an economic association and enables it to display the features of a strong political community. When the crisis began, it seemed for a moment that Europe would split in two economically and socially, but thanks to rapid and effective action by the Commission, we were able to prevent that from happening.
Hungary turned first to the European Union to ask for its assistance. However, the EUR 20 billion which we needed in support, or financing, would not have been possible from that source alone.
Ladies and gentlemen, I would like to thank the Commissioner and the European Parliament for their quick response, for the solidarity of our colleagues, which shows the value of being European. Thank you for your attention.
(DE) Mr President, the proposal concerning amending the Regulation on assistance for Member States which are not part of the euro area, in order to increase the ceiling from EUR 12 to 25 billion, if they are hit by grave payment difficulties, has been made at the last moment.
The primary requirement for ensuring that these ad hoc measures work is that the EU does not make the same mistakes as the International Monetary Fund (IMF) with respect to counter demands. At the IMF, Mr Strauss-Kahn alone is not a guarantee of a sensible policy. We know the shock therapies used for countries devastated by crises in the old neo-liberal style only too well.
We also know those who have previously profited from this only too well. I hope that better, more sustainable stability will be achieved using the EU tool, based on the example of Hungary. Hungary shows us in particular that the EU has to realise that it was the conservative opposition that obstructed Hungary's premier with respect to stability and reform measures. The stability of Hungary will certainly not be achieved by curbing social expenditure alone, social expenditure which is actually not too high anyway; this will only help the anti-European right-wing populists. Yes, Hungary has been put under pressure, especially due to the rapid depreciation of the forint, which hedge funds have been partially responsible for.
In the case of Iceland, the IMF has demonstrated that it is still enforcing shock therapies, for example by imposing high base interest rates to the detriment of the national economy concerned, in this case the national economy of Iceland. Commissioner, please take into account that I do not want my neighbour Hungary to be plummeted into social conflict due to corrective measures such as this based on counter demands. Hungary needs confidence-building, supportive action from the European Union, which, after all, will help not only Hungary but all of us.
(DE) Mr President, I believe that this debate is taking place at exactly the right time.
I would like to remind you that Hungary is the country that has used the budget deficit to the greatest degree: minus 5%. This shows us that stability in this country also has a political background. It makes no sense that, in the future, we abandon the state - and after all, this refers to all the taxpayers - to the risks involved in some businesses. In this case I completely agree with Mr Ettl, we cannot burden the taxpayers with the risks of hedge funds and derivatives as this would lead to limited purchasing power.
This is precisely what we need in Hungary: more purchasing power. We need people to invest in the country and in the companies again and this means that we need tax reductions so that investment is possible once more and not only for companies but, above all, for employees. I believe that I am drawing the right conclusions. Decisive factors are that allowances are granted, for example for energy efficiency measures, that investment bonuses are given, and that appropriate progressive depreciation is carried out.
I would like to ask Commissioner Kovács, who comes from Hungary, to set up appropriate initiatives at European level.
Mr President, I came down to the Chamber while I was watching the debate in my office just to make, I suppose, a broad point.
In Ireland we have the bank guarantee scheme, because of the financial crisis, and we have more unity now in the EU as to how we deal with this. But we now realise that our banks will need to be recapitalised and, perhaps, as a matter of more urgency than we first thought. I wish to express the hope that that would happen, because we have a real problem, as was said by the previous speaker. We need people to spend and to invest and there just are no credit lines available. I think it is most important that something happens swiftly to restore confidence and capital to the banking system.
. - (RO) Mr President, Commissioner, ladies and gentlemen, I am pleased that we have this opportunity this evening to discuss such an important issue, the economic crisis, which is affecting not only Member States, but the whole world.
We therefore need to find solutions to this problem. Mutual support for Member States should be one of the steps to be taken in this direction. Bearing in mind that we want EU Member States to resort to this fund when necessary, we must welcome the decision made by European political leaders at last week's summit.
I believe that this European financial assistance fund for Member States needs to be increased to at least EUR 25 billion for one reason: we need to save this market economy. Before I finish, I would like to express my confidence that we will take the measures required to overcome this crisis, both at a European and global level. We urgently need to find the resources required to avert the problems which our citizens are going to be faced with, such as unemployment. We all wish the best for the EU.
(LT) I would like to thank the Commissioner for pointing out quite rightly today that this problem is linked to the question of how to make the free movement of capital compatible with the stability of macroeconomic nations. I do not really like my fellow Members saying that this is a problem for the poor countries of the European Union. Ladies and gentlemen, if the economies of Germany and France were to grow by 2 and 3 percent, that would pose no problem for those of us who have integrated into the common market. Therefore, if some kind of package is also required as a stimulus for national economies, it should be implemented by the countries mentioned and then we would not be talking about stabilisation funds. In truth, we do not need that money, but guarantees that the European common market will function well and grow. If there are such guarantees, which must be achieved through our joint efforts, then all the problems will be solved.
Mr President, I want to thank the Members for the support expressed in most of their speeches for the Commission's decisions and proposals on this issue.
I should like to make three very quick comments on three of the issues raised in your speeches. Firstly, I share Mr Becsey's concern about the risks posed by families and businesses taking on debts in foreign currencies, in countries which have a floating exchange rate and which are subject to risks of excessive volatility in their exchange rate, as was the case with Hungary. Mr Becsey knows of my concern because the budgetary and economic surveillance that we carry out in the Commission is sometimes not sufficiently heard or heeded or does not have the desired effects when comments are made on this type of risk.
We are, I believe, more effective in budgetary surveillance. The case of Hungary is very positive in this sense, given the major budgetary adjustment that has occurred in that country between 2006 and now. However, on the other hand, we have had no success in terms of the risks posed by taking on debts in foreign currencies. I hope that, from now on, given the circumstances not only in Hungary but also in other EU countries due to the crisis and excessive volatility in many financial indicators, particularly in exchange rates, this type of comment and recommendation will be heeded more.
Mr Lundgren is no longer here but he made comments that were totally incorrect. He criticised Hungary and the Commission for recommending to Hungary that it should have a fixed exchange rate, whereas the situation is exactly the opposite. In other words, the exchange rate in Hungary is floating and the excessive volatility in this exchange rate aggravated the problems and was one of the factors that caused the crisis having led to the request for this help. As a result, when criticisms are made, people should ensure that these are based on correct information and not on totally wrong information. If Mr Lundgren had stayed until the end of this debate, he would have been aware that his information was totally wrong. As he is not here, I hope that one of you will let him know.
Finally, with regard to the comments made by Mr Rübig on the deficit, it is not true that Hungary has a 5% deficit as this has been significantly reduced. In 2008 the deficit will be clearly below this figure, in fact it will be below 3%, and in the commitment made by Hungary as a condition of this help, the target deficit for next year is 2.6%. Therefore, if this target is met - and I hope that it will be - Hungary will have to face another kind of problem. Undoubtedly it will have to face this and will continue to do so, unfortunately, but at least next year it will not have an excessive deficit.
rapporteur. - (FR) Mr President, Commissioner, ladies and gentlemen, I have four comments.
The first is that the Commissioner is asking us to give a fast, flexible response to any such new request. I believe that the European Parliament has shown that it can come up to the mark. Today, we are accepting the threshold of EUR 25 billion to amend the 2002 liability regulation, insofar as we know the conditions for negotiating with the Council, but of course, we are showing ourselves to be open and available to, unfortunately, envisaging other scenarios.
My second comment is to remind you that, for us, one of the lessons of this stage of European integration is that, for each Member State, whether or not they belong to the euro area, the first circle of solidarity, the first circle for discussions, should be the European Union. I hope that, today, for each of us, for the institutions and for the Member States, that is clear.
My third comment is to note with satisfaction the Commission's commitment to make public, or first to examine, then make public, both in our Economic and Monetary Committee and in Mr de Larosière's group, the lessons to be learned from the situation which has developed in Hungary.
My final comment is to note with you that, in this crisis, everyone believed that there would be two channels for transmitting the crisis, the complex financial markets on one hand and, on the other, the real economy.
In fact, we now see that there is a third transmission channel, namely, the movements of capital which can affect even simpler, less opaque financial markets. This is why the interweaving of the real economy and the financial markets, whose extent, I believe, we have yet fully to gauge, is so important. Unfortunately, we are finding out more day by day, and we are faced with an issue which needs us to show flexibility and collective intelligence to find suitable solutions.
Parliament has, I believe, once again shown its ability and desire to contribute to finding suitable solutions to each new aspect of this crisis whilst hoping that, finally, we will also find what we need to allow our economy to face the challenges in these very difficult times.
The joint debate is closed.
The vote will take place on Thursday, 20 November 2008.