Business as usual was no longer an option for the second largest currency in the world.
We have fundamental reforms to carry out and we will carry out those reforms. It is a major priority for me and for the European Council, said president Herman Van Rompuy in a statement on Greece and solidarity in the Euro Area on the eve of an extraordinary weekend (5 May 2010).
In our latest blog post we tracked the eurozone crisis measures to the activation of financial support for Greece, but now we start to turn towards the responses given to the challenges for the whole eurozone, as well.
The extraordinary meeting of the heads of state or government of the euro area 7 May 2010 issued a statement, which endorsed the implementation of the support package for Greece, described as reflecting the principles of responsibility and solidarity.
The national leaders reiterated, in their own words, the motto of the Three Musketeers “all for one, one for all”:
In the current crisis, we reaffirm our commitment to ensure the stability, unity and integrity of the euro area. All the institutions of the euro area (Council, Commission, ECB) as well as all euro area Member States agree to use the full range of means available to ensure the stability of the euro area.
Consolidation and stabilisation
The heads of state or government outlined the next steps towards fiscal consolidation, endorsed the actions of the European Central Bank (ECB) and indicated the establishment of a European stabilisation mechanism during the same weekend:
Today, we agreed on the following:
- First, consolidation of public finances is a priority for all of us and we will take all measures needed to meet our fiscal targets this year and in the years ahead in line with excessive deficit procedures. Each one of us is ready, depending on the situation of his country, to take the necessary measures to accelerate consolidation and to ensure the sustainability of public finances. The situation will be reviewed by the Ecofin Council on the basis of a Commission assessment by the end of June at the latest. We have asked the Commission and the Council to strictly enforce the recommendations addressed to Member States under the Stability and Growth Pact.
- Second, we fully support the ECB in its action to ensure the stability of the euro area.
- Third, taking into account the exceptional circumstances, the Commission will propose a European stabilization mechanism to preserve financial stability in Europe. It will be submitted for decision to an extraordinary ECOFIN meeting that the Spanish presidency will convene this Sunday May 9th.
In addition, the leaders of the euro area were prepared to strengthen economic governance and to make rapid progress on financial markets regulation and supervision.
Practically every timetable was accelerated, with the Europe Day ECOFIN Council called to hammer out the details.