EU's Moscovici says euro states should have joint finance minister

EU Economic Commissioner Pierre Moscovici has said eurozone countries should have a joint finance minister within the EU Commission, Reuters reported. “I believe that the executive role of the EU Commission should be dramatically enhanced in the Eurogroup, and that the Commission should be represented by a Eurozone Finance Minister,” Moscovici was quoted by the news agency. “The Eurozone Finance Minister would be in the front line to handle crises on behalf of the euro area community, and he or she should be able in due time to draw on financial resources available for the euro area.”

Earlier this month, EU Commission President Jean-Claude Juncker presented plans to built a Treasury for the eurozone on the basis of Europe’s permanent bailout fund ESM which has a potential credit volume of 500 billion euros, a firepower that is as important as the one of the International Monetary Fund. “The ESM should progressively assume a broader macroeconomic stabilisation function to better deal with shocks that cannot be managed at the national level alone”, Juncker said. He announced that the EU Commission “will prepare the ground for this to happen in the second half of this mandate.”

The cep, however, believes that instead of creating an Euro-Treasury it would make more sense to introduce a sovereign default regime for the eurozone. Thereby, markets would exert the necessary reform pressure on governments, something which the EU Commission or the Eurogroup has never been able to do. The cep has drawn up a blueprint for a sovereign default regime. You can find it here.