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Speech at the conference "A Growth Vision for Europe"

Speech at the conference "A Growth Vision for Europe" the 10 th. of January 2013.

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Ladies and gentlemen,

I am very pleased to be able to address this mixed Danish-Irish forum today. On January 1st Ireland assumed the Presidency and at the same time we could celebrate our joint 40th anniversary for the entry of our two countries in the European communities. 
The cooperation has developed a lot since then. It has been a prime driver of peace, reconciliation and prosperity in Europe, as acknowledged by the award of the Nobel Peace Prize. The EU continues to extend its stabilizing role throughout the continent, as witnessed through the current wish of the Balkan countries to join our unique union. 

However, in recent years the EU has faced major challenges arising from the consequences of the economic and financial crisis. The debt challenges of a number of European countries have put the EU to the test. Many on the outside doubted we would be able to handle the issues. Nevertheless, at the beginning of 2013, it is not only clear that the EU is managing the problems without breaking apart. We have also demonstrated our capability to make a number of difficult and far-reaching decisions even in the most challenging circumstances. 
The debt crisis is far from over. Economic imbalances were built up over a long period of time. This cannot be solved overnight. Stabilizing the economic situation and laying the ground work for sustainable growth is a long and hard process. We are not out of the tunnel yet. But we can glimpse the light at the end of it. The decisions made at the last Summit to strengthen the Economic and Monetary Union constitute an important step in the right direction. 

Even though not all Member States are part of the euro area, we all share a common interest in ensuring a strong and stable euro, and in avoiding artificial dividing lines within the EU.

Denmark has engaged actively in the negotiations on the single supervisory mechanism – the first element of the banking union. We will continue this engagement with regard to the resolution mechanism and backstop for financial institutions. The outcome of these negotiations will be important when we evaluate whether Denmark as a non-euro country can and will participate. Each proposal will be evaluated on a case-by-case basis considering Danish interests. But let me make it clear: Denmark has – unlike others – chosen to remain closely attached to the euro-zone. We do not question our position in the EU, nor strive towards renegotiation of the conditions for our membership. 

Ladies and gentlemen,

We have come a long way on the road towards a more solid framework for economic cooperation. When dealing with the consequences of the debt crisis we must always remember the goal: To establish the best conditions for job creation and sustainable growth. The institutional and legal arrangements we may undertake to ensure a proper functioning of the EMU are not ends in themselves, but measures to accomplish this goal.

In order to achieve the right conditions for growth and job creation we need continued efforts on not only consolidating public finances, and targeting investment to boost growth and employment, but also on creating actual structural reforms, which promote competitiveness. However, structural reforms must not become synonymous with cutting welfare spending. Through allocations of EU funds, we must seek to stimulate reforms which change the way labour and product markets function. Our decisions in the financial sector constitute a tremendous structural reform. 

Growth was one of the main themes throughout the Danish EU Presidency. One of our main achievements in this respect was the Compact for Growth and Jobs. This compact still provides the framework for action at EU- and national level to revive growth and investments.

I wish to highlight three aspects of the compact, to which the Danish government attaches particular importance, and where the effort over the coming year will be crucial to promote growth and social welfare.
First of all, we need to strengthen our efforts in creating a green Europe.
Secondly, we need to improve the job opportunities for the unemployed, by helping them to achieve new competences through education.
And thirdly, we need to provide new dynamism to the European economy through a further deepening of the single market.
Let me expand a bit further on each of these important issues.

It is no secret that the Danish government is particularly ambitious when it comes to green growth. Our national goal is to have our entire energy supply covered by renewable energy in 2050. After intensive negotiations during our presidency, the EU managed to agree on an ambitious directive on energy efficiency. It was an important achievement, which demonstrated that Europe is the leading global region in sustainable energy and climate policy. A common framework of measures to promote energy efficiency was the brick missing for the EU to reach the 2020-goals.

The energy efficiency directive is now being transformed into national legislation in each of the 27 member states and is expected - once implemented - to increase the EU´s gross national product by approximately 34 billion euros. The Commission expects that this will create more than 400.000 new jobs through public and private investments.

We must continue our efforts to promote green growth. We need to agree on new milestones and targets for renewable energy, energy efficiency and CO2 reductions for the period after 2020, to ensure sound investment planning. And we need to make a coordinated effort between all relevant sectors, such as agriculture, transport and research. Green growth is not only about improving energy efficiency and replacing fossil fuels with renewable alternatives. It is also about improved water management, more efficient agricultural production, reducing food waste, more efficient urban planning. And it is about providing people with incentives to change their consumption patterns in a more sustainable direction.

In parallel with our efforts to promote green growth, we must continue to strive to strengthen the skills of the unemployed.
Unemployment has increased dramatically in a number of Member States during the crisis. Particularly worrying is the situation regarding youth unemployment. The Commission has estimated that around 7, 5 million young Europeans are neither in employment, education or training. All member states must acknowledge this challenge and act accordingly. We cannot risk losing an entire generation of young people in Europe.

The overall aim of Danish employment policy is to make sure that young people are educated, and young people with an education are employed. We need to boost our efforts at further improving the job opportunities by helping unemployed people to achieve new skills through education. Good qualifications grant access to the job market.

Employment policy falls under national competence. Each member state must decide the right steps to take. We should of course respect this. But it does not mean that we cannot learn from each other´s best practice, taking into account national situations.

Also, the reform of the future cohesion policy and the agreement on stronger programming, evaluation, conditionality and thematic concentration of the structural funds under the Europe2020 Strategy will ensure that EU funds will provide a more effective contribution to competitiveness and employment, especially in the least developed regions of Europe.

The progress made during 2012 towards an EU approach with the so-called Youth Package was an important step. At the Summit in December, we agreed to continue these efforts in 2013. The Member States particularly emphasised the need to adopt a “youth guarantee”, ensuring that young people under the age of 25 receive an offer of employment, continued education, or a traineeship within 4 months of becoming unemployed or leaving formal education.

Finally, the Single Market still provides us with a huge untapped potential.  During the last 20 years it has proved a main driver of growth in Europe. We need to build on this huge achievement and deepen the Single Market further to promote economic growth and employment. 

It is important to unlock the full growth potential of the Single Market - not least in the digital and network industries - by removing remaining barriers and ensuring better implementation of the rules already in place. A recent study estimates that additional gains could be made if member states increased their level of implementation of the Services Directive. The economic impact could reach a 2.6% increase in the EU GDP. 

Ladies and gentlemen,

Before concluding, I would like to touch upon one of the main issues we will – once again - be dealing with shortly: The seven-year EU budget for the period 2014 to 2020 - the so-called Multiannual Financial Framework.
Public budgets are under heavy pressure in all European countries today. The European budget should reflect this. At a time where national administrations are cutting back, we cannot increase the EU-budget. Instead of spending more, we need to spend the money more wisely. There is a big scope for improving the return of our money spent on promoting growth in the regions – which is a third of all we have in the EU. We are about to launch a crucial reform on precisely this: our use of structural funds.

All in all we are facing an intensive and demanding agenda over the coming six months. '

A year ago, the Danish Presidency began under the motto “bridge over troubled waters”, making a special effort to ensure the coherence of the EU during a difficult period. Due to the common endeavors of all Member States, the EU managed not only to remain unified, but also to take important steps in the right direction.
Navigating the troubled waters of the debt crisis is, however, still a challenge for the EU and for the Presidency in particular. It will require experience, skills and professionalism. I am confident that with Ireland at the helm during the next half year, we will continue to be able to weather the storms together.

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