Today’s EU summit in Brussels focused on growth rather than austerity, with Prime Minister Hell Thorning-Schmidt of Denmark commenting that it was the first ‘non-crisis’ summit in a very long time. President Herman Van Rompuy spoke of how budget deficits are only means to an end, and that economic growth is the primary aim: “The restoration of confidence in the future of the Eurozone will lead to economic growth. This is our ultimate objective.” However European leaders are alert to the dangers of overreacting to positive news and will be wary of the economic downturn that followed Greece’s first aid package.
Following the talks the European Council released a statement detailing this morning’s agreements. The vowed to focus on promoting growth within the new 3% deficit rule. They promised to collect more tax, collectively by improving the efficiency of the tax system across Europe. They agreed to reduce red tape in businesses to make it easier to hire people, in order to increase overall employment to 75% in the EU by 2020. They hope to strengthen the single market by removing trade barriers, and seek to turn Europe into a league table, where a transparent scoreboard will rank each nation’s progress – this will supposedly quicken reform through ‘peer pressure’. Banks and credit ratings will be reformed; innovation, research and business lending will be largely encouraged.
David Cameron has claimed full responsibility for these growth-orientated developments, he complained on Thursday that Europe wasn’t listening to him, but insisted today that: “The communiqué has been fundamentally rewritten in line with our demands. Our letter really did become the agenda for the European Council.” His view that he had converted the rest of the EU leaders to his free market vision of deregulated and liberalising services was dismissed as “nonsense” by other European officials.
Euro Currency News
German Retail sales fell by -1.6% in January, UK Construction PMI grew by 2.9 points to 54.3 and European Price Index marked inflationary levels at 3.7%.
The Pound to Euro Exchange Rate has rallied back to the comfort of 1.2 on today’s ecostats. GBP/EUR currently trades at 1.2006 as of 15:07 GMT.