This week’s meeting of the European Council will be a particularly busy one. There are a significant number of issues on the agenda which are of importance for Europe and for Ireland.
The Council will meet tomorrow evening and continue its business into Friday. Our discussion tomorrow evening will be devoted to economic issues. On the morning of 24 June, we will discuss asylum and migration issues. And we will discuss foreign policy matters, including Syria, Libya and the Middle East generally in our final session over lunch.Situation in Greece
Finance Ministers dealt extensively with the question of Greece at their meeting on Sunday and Monday. The ball is now firmly in the Greek court. Having last night won a vote of confidence, the Greek Government now needs to secure the support of Parliament for new budgetary measures if the fifth tranche of funding under the Greek Programme, amounting to €12 billion, is to be released. The question of a second longer term package for Greece is to be discussed further by Finance Ministers in July.
While I expect that Heads of State or Government will take stock of this situation, I agree with President Van Rompuy who, when he met with me here in Dublin last Friday, made it clear that he does not wish the situation in Greece to dominate the European Council meeting. There are other important matters to be discussed and it is important that they be given due time and attention.Irish Concerns
As the House will be aware, discussion of the situation in Greece has particular significance for Ireland, as another Member State in an agreed Programme, albeit on a different basis from Greece.
Any agreement on future arrangements for Greece must avoid any negative read-across or risk of contagion to others, with potentially serious consequences for Ireland. We know from experience that the markets do not differentiate the situations of Member States as finely as they should.
The Irish people are making great efforts to get our economy back on track. The Government has made clear its commitment to ensuring
that Ireland pays its way, honouring the commitments into which it has entered.
At the meeting I will be working to ensure that Irish interests are fully safe-guarded.
I will also continue to emphasise the importance of ensuring that all aspects of a Programme support the shared goals of early recovery and return to borrowing on the markets.
One element of this is, of course, the pricing of loans, and I will continue to press the case for early implementation of the March agreement to lower the interest rate under the EFSF.
At that time, it was agreed that a lower rate would better take into account the debt sustainability needs of recipient countries. This analysis remains sound and what has been agreed should be put into effect, including for Ireland.
In this regard, I very much welcome the agreement earlier in the week that the permanent EU funding mechanism which will enter into force in 2013 – the European Stability Mechanism – will not apply preferred creditor statements to any loans made to Member States currently in a Programme under the EFSF.
This will assist us in making as early a return to the markets as possible – which has always been our goal. While we do not intend or expect to be clients of the ESM, the mere possibility of having loans subordinated to those under the ESM was already causing difficulties for Ireland and others, given the uncertainty it created for potential lenders. This uncertainty has now been removed.
The change will be reflected in the Treaty necessary to establish the ESM. The European Council will sign-off on this agreement, though, given the political requirements of some Member States, formal signature is expected to take place at a later date.Discussion of Economic Matters
President Van Rompuy indicated to me that he wishes the economic discussion to be a wide-ranging one.
Part of this will be the endorsement of the country-specific recommendations, proposed by the Commission and adopted by the Council, following the submission of National Reform Programmes and Stability Programme Updates by Member States. This is the final step in the new European Semester and, once the recommendations are endorsed, Member States will be expected to reflect them in their forthcoming budgetary processes.
In Ireland’s case, the recommendation is that we continue to implement the EU/IMF Programme as the best means to get the economy back to growth and recovery, and to restore our ability to return to borrowing in the open markets as quickly as possible.
More generally, each Member State is being asked to give particular priority to ensuring a sound macro-economic environment - restoring financial sustainability, correcting macro-economic imbalances and repairing the financial sector; reducing unemployment, in particular through labour market reforms; and making renewed efforts to front load growth.
There will also be discussion of the commitments that Member States have made under the new ‘Euro Plus Pact’ – over 100 separate measures has been pledged by those participating. In Ireland’s case, our commitments are drawn from the EU-IMF Programme Commitments and the National Reform Programme. It is expected that the European Council will welcome these commitments as a good first step. It is intended that we will return in December to take stock of progress being made in implementing what has been agreed.
The meeting is also expected to confirm the appointment of Mario Draghi as President of the European Central Bank.Migration/Schengen
Over recent years, significant progress has been made in developing a strong common European policy in the field of asylum and migration. This is an important feature of a Union which has at it core the right to free movement within its borders.
However, there is little doubt that recent events, including in the Southern Mediterranean, have placed the system under pressure, and that the brunt has been felt in a number of particular Member States. For this reason, and in a spirit of solidarity, Minister Shatter recently announced the Government’s willingness to receive a small number of refugees from Malta.
While, for some time, consideration has been given to improve the operation of the current Schengen area, this has now been pulled into sharp focus.
The European Council will therefore have discussions on issues such as how better to ensure trust in the system; how to ensure that Europe’s borders are effectively and coherently managed; effective and reliable monitoring; and the possibility of a safeguard mechanism to be invoked in response to exceptional circumstance, with due regard to the principle of free movement.
These are very sensitive issues. I do not necessarily expect that this week’s meeting will be able to reach final agreement, but I do expect that it will give added impetus and momentum to the work.
As the House will be aware, Ireland does not participate in the Schengen area. However, we do share an interest in ensuring a consistent and strategic policy to manage mobility in a shared environment.
An important objective must be to address the root causes of migration at a structural level. That is why the European Council will also agree to develop a partnership with the countries of the Southern Neighbourhood on which the Commission has recently brought forward a Communication.
This could include a structured dialogue with the countries of the region on migration, mobility and security, aimed at delivering tangible benefits to both sides.Croatia
Now that accession negotiations with Croatia are reaching a successful conclusion, the European Council is expected to call for them to be formally closed by the end of the month, with a view to signature of an Accession Treaty by the end of the year.
Ireland has long supported the Croatian case for membership, and congratulates the Croatian government and people on reaching this important milestone.
As the House will recall, before the second referendum on the Treaty of Lisbon, Ireland secured legally-binding guarantees on taxation policy; family, social and ethical issues; and defence matters.
It was agreed at the time that these guarantees would be attached to the Treaties by means of a Protocol at the time of the next Accession Treaty.
Contacts with the relevant authorities, including the Council Legal Service, are already underway to ensure that this work is taken forward as speedily as possible.
It will also be necessary to give effect to the decision that the Commission will continue to comprise one Commissioner per Member State.International Issues
Finally, the European Council will also discuss a number of important international issues, including the situation in Syria and Libya and the Middle East generally. Minister of State Creighton will say a little more about these aspects in summing up.