BRUSSELS Jan 11 The following are comments by
Olli Rehn, European Union economic and monetary affairs
commissioner-designate, during an approval hearing in the
European Parliament on Monday.
ON GREECE SPILLOVER
"The problem in Greece concerning the excessive deficit and
the rapidly rising public debt is a very serious one, especially
for Greece, Greek citizens and taxpayers. Of course, it also has
potential spillover effects for the whole euro zone.
"It is not so serious yet that it would threaten stability
of the euro zone and therefore it is absolutely essential that
the Greek government and parliament take rapid action to create
a convincing economic policy package."
ON BRITAIN, GREECE
"It is very important that the UK government pursues these
objectives (budget deficit cuts) with determination.
"I want to work with Greece and the Greek government ... but
still the main responsibility is in the hands of the Greek
government and parliament to ensure that the excessive deficit
will be brought to a sustainable course.
"It will be a major political and economic challenge for the
Greek government and the whole society."
"In my view the exchange rate of the euro in relation to
the dollar and thus to the renminbi (yuan) ... is a potential
risk for European recovery and therefore we have to continue to
discuss with the Chinese on this matter."
ON MORAL HAZARD
"In my view the Stability and Growth Pact ... must by
definition ensure that members of the euro zone have sustainable
public finances ... so there is no need for a permanent crisis
"(Such a) mechanism ... would involve a major risk of moral
ON GREEK ECONOMIC DATA
"The Greek administration has started taking measures, and
the (European) Commission and Eurostat (the EU statistical
agency) support Greece in the measures they are taking.
"We will have to consider the Commission being given those
auditing powers so we can make sure the data from member states
is correct and trustworthy."
"Membership in the euro zone should not cause a rise in
"The next likely candidate should be Estonia, it should be
able to enter the euro zone.
"Estonia is rather close, but we will have to ensure that
all the rules are respected, that the (EU) treaty is respected,
and we will return to this matter in the coming spring."
"The next likely candidate is Estonia. Public finances are
in pretty good shape."
ON EURO ENLARGEMENT
"For me, it is clear that the fundamental objective is
sustainable public finances ... and macroeconomic stability.
Convergence criteria are proxies for indicators that measure
whether the country meets the criteria for sustainable public
"China is a surplus economy which is not willing to let its
currency appreciate, while the United States has long been a
deficit economy, with a very high current account deficit.
"In this context we have to pursue a serious discussion with
our main partners, especially the United States and also China,
on how we can return to better global balances.
"In this sense, China is at least as important as the United
ON INFRASTRUCTURE BONDS
"As regards financing of the infrastructure of communication
networks, energy networks ... on a European basis, I think that
merits a fresh look (the idea of pan-EU bonds) and I have an
open mind as regards this kind of project financing together
with, for instance, the European Investment Bank."
"We have to coordinate our actions better. This will be one
of the main tasks of the new (European) Commission."
ON FISCAL CONSOLIDATION
"The exit strategies are so important in the sense that we
have to get them right. They need to be well coordinated, not
one size fits all, but taking into account country-specific
"Fiscal consolidation needs to start in 2011 at the latest,
in some countries earlier."
Asked whether he thought Greece might leave the euro zone:
"No, I don't.
"The Greek government is aware of the seriousness of its
situation. The (European) Commission is assessing the matter
with major concern.
"Now it is essential that the Greek government shortly, in
the next couple of weeks if not days, present a comprehensive
policy package ... concrete, tangible measures on how to reduce
the excessive deficit."
ON SINGLE REPRESENTATION FOR EUROPE
"Currently we punch below our weight.
"By standing united we can lead, not follow.
"We have to have a single representative for Europe in the
area of world economic governance."
ON EURO ENLARGEMENT
"Economic stability in Europe can also be reinforced through
a gradual enlargement of the euro area, for which I will work on
the basis of existing rules, ensuring equal treatment."
ON FISCAL PACKAGES
"Fiscal stimulus packages ... need to be withdrawn when the
time is right.
"We have to strengthen coordination of economic policies,
coordinate stimulus measures and exit strategies.
"We have to restabilise public finances over the next few
years, this will require rigour."