STATEMENT BY THE EURO AREA HEADS OF STATE OR GOVERNMENT
The European Union and the euro area have done much over the past 18 months to improve economic governance and adopt new measures in response to the sovereign debt crisis. However, market tensions in the euro area have increased, and we need to step up our efforts to address the current challenges. Today we agreed to move towards a stronger economic union. This implies action in two directions:
- a new fiscal compact and strengthened economic policy coordination;
- the development of our stabilisation tools to face short term challenges.
A reinforced architecture for Economic and Monetary Union
1. The stabilityand integrity of the Economicand Monetary Union and ofthe European Union as awhole require the swift andvigorous implementation of themeasures already agreed as wellas further qualitative movestowards a genuine "fiscalstability union"in the euroarea. Alongside the single currency,a strong economic pillar isindispensable. It will rest onan enhanced governance to fosterfiscal discipline and deeperintegration in the internalmarket as well as strongergrowth, enhanced competitiveness andsocial cohesion. To achieve thiso bjective, we will build on and enhance what has been achieved in the past 18months: the enhanced Stability and Growth Pact, the implementation of the European Semester starting this month, the new macro-economic imbalances procedure, and the Euro Plus Pact.
2. With this overriding objective in mind, and fully determined to overcome together the current difficulties, we agreed today on a new "fiscal compact" and on significantly stronger coordination of economic policies in areas of common interest.
3. This will require a new deal between euro area Member States to be enshrined in common, ambitious rules that translate their strong political commitment into a new legal framework.