will not be like the federation in the united states ; europeans have their traditions and their history. at the level of this possible confederation, we would have, naturally, a european finance ministry with its own responsibilities. sz : that is still a political utopia. trichet : we are talking about a historic process that began 60 years ago. the vision of european unity goes back many centuries. you feel that very profoundly in aachen when you are in front of the throne of charlemagne. i firmly believe that, from the economic and monetary angle, there are even more reasons to unify europe today than 60 years ago, with india, china and the formidable progress of the emerging economies. sz : french politicians have also spoken in favour of a european ministry – as a counterbalance to the ecb. trichet : i think they understood that it was a totally wrong approach. the ecb is fiercely independent and this is not challenged anywhere in europe. it is at the heart of the maastricht treaty. and i do not forget that the germans have always said in the past that there needs to be progress in terms of political union, together with economic and monetary union. sz : are there enough europeans who support your vision? bis central bankers ’ speeches trichet : i speak as a european citizen, reasoning in the medium and long term. it seems clear to me that the european construction has not been completed. sz : if all of that is true, then there should also be shared eurobonds, guaranteed by all the member states. trichet : we have looked into the issue and we are not in favour of it. sz : but that could be part of your vision? trichet : no, not necessarily. the ministry that i have in mind for the future shouldn ’ t have a large budget. sz : how, in your view, should the current debt problems in europe be resolved? you are something of an expert on debt – after all, you previously played a leading role in the paris club in negotiating the debt restructuring of brazil, poland, egypt and the soviet union. this always involved partial losses for creditors, or a “ haircut ”. trichet : our position for europe was always clear. we were not responsible for the negotiations concerning greek debt. that was the task of the governments. we will monitor events closely. sz : two years ago, you said that the entire regulation of the financial system needed major improvements. has this already

: first, only small eu states were rescued. most recently, however, italy – a core country that is also highly indebted – was on the verge of being pulled into the maelstrom. there was hardly anyone who wanted their government bonds. trichet : i have confidence that all countries in the euro area will not only rigorously keep their present commitments, but will be “ ahead of the curve “ and take appropriate measures, as is the case for italy. sz : europe ’ s citizens have heard this kind of appeal too many times before. trichet :. as i said, all advanced economies must put their house in order. the united states and japan, for instance, have to adjust their fiscal policy. in the case of europe, a major problem is the need to make decisive improvements in its governance. the stability and growth pact must be strengthened. and we will have a new pillar of surveillance of competitiveness indicators and imbalances inside the euro area, namely the new legislation. sz : how will the new controls work? trichet : we are advising the governments and the european institutions to develop the surveillance functions so that they operate as automatically, quickly and professionally as possible, both in their preventive arm and in their corrective arm. and the sanctions are essential to prevent disorderly developments. sz : is a new institution needed for this? trichet : at this stage we need to finalise the negotiations of the “ trialogue ” – between the council, parliament and commission – on the new legislation for european governance. what has just been announced by the heads of the euro area should contribute to improving the preventive arm of the stability and growth pact in line with our recommendations. sz : you yourself were much more daring when you were awarded the charlemagne prize in aachen. there you spoke about a common finance minister for europe. trichet : i think that in order to put thursday ’ s decisions into perspective, it is important and legitimate to have a vision of what could be done – as i said in aachen – tomorrow and even the day after tomorrow. that would require a change to the treaty and is therefore fully in the hands of our democracies and of europe ’ s citizens. tomorrow it should be possible to impose measures on a country that does not implement the agreed adjustments. and as for the day after tomorrow, speaking as a european citizen, i think that the europeans will invent a new type of confederation which, however,