Debate: European Central Bank - annual report
Date: TUESDAY, 11 FEBRUARY 2020
Speaker: Costas Mavrides
Country: Latvia
Language: EN

The timing is important. This report is the first of the new legislative term and following the election of the new ECB President. And, of course, like the President has said, we are very glad to have you here today with us, Ms Lagarde. The report focuses on the review of the current ECB policies, future monetary policy, actions against climate change, and a stronger global role for the euro.  Regarding the monetary policy actions of the ECB in 2018 and their impact on the euro area economy, we welcome the ECB’s role in safeguarding euro stability. The non-standard monetary policy measures put in place by the ECB contributed to economic recovery, to an improvement in financing conditions and to compressing yields across a wide range of asset classes. We also stress that the very low or negative interest rates offer opportunities to consumers, companies (including SMEs), workers and borrowers who can benefit from stronger economic momentum, lower unemployment and lower borrowing costs. At the same time, we ask the ECB to keep monitoring potential risks to its balance sheets, asset price inflation, disadvantages to savers and the potential impact on pension and insurance schemes. However, we are concerned that after a short economic recovery, euro area growth momentum has slowed to 1.1% of GDP in the euro area, and therefore we note the need to maintain both the liquidity conditions and a degree of monetary accommodation. Recognising the sustainable growth cannot be achieved by monetary policy alone. We underline that supportive fiscal policy is also necessary.  We also agree with ECB President Christine Lagarde’s statement that a review of the ECB’s monetary policy framework is timely and warranted, and we stress that this should be done by organising a public consultation and involving Parliament. An important point also raised in this report is the finding of the European System of Central Banks Expert Group on low wage growth, stating the disconnect between wage growth and labour market recovery  Two words strengthening the role of the euro area. It requires the right structural conditions, including the deepening of the European Monetary Union, the completion of the Banking Union with the European Deposit Insurance Scheme and the completion of the Capital Market Union. Special emphasis is given to the fight against climate change and the implementation of the Paris Agreement. We stress that the ECB is bound by the Paris Agreement on climate change and this should be reflected by implementing the environmental, social and governance principle into its policies.  We underline other aspects interrelated with ECB policies regarding Brexit, the Capital Markets Union, crypto-assets, the need to increase monitoring and to have a comprehensive regulatory framework, the importance of micro, small and medium-sized businesses in the EU and their access to credit, more efforts to ensure the financing of the real economy and much more. On accountability, we welcome the increasing accountability under the Presidency of Mario Draghi and we express our will for even greater accountability, dialogue and openness with the current President.  A final point. It is essential to formulate our monetary policy but also to communicate it to our citizens, as they need to understand the importance and the impact of those policies on their lives. I would like to thank all the shadow rapporteurs for their constructive and fruitful collaboration during the negotiations, and I do believe that the European Parliament and the ECB have a common objective. This was my primary objective when I drafted this report – to improve the lives of our citizens by achieving real economic convergence and to strengthen the role of the EU as it is our common home.