This is how the new economic rules were discussed in the EU – Strict ukaasi member states: “The rules have no function if no one follows them”

Finance Minister Annika Saarikko (Centre) participated on Tuesday in the Ecofin meeting of the EU Economic and Financial Affairs Council.

On Tuesday, Minister of Finance Annika Saarikko (Centre) participated in the Ecofin meeting of the EU Economic and Financial Affairs Council. Pete Anikarihannamari.ahonen@iltalehti.fiYesterday at 21:30

Finance Minister Annika Saarikko (center) participated on Tuesday in the Eurogroup of Finance Ministers and the EU Economic and Financial Affairs Council Ecofin meeting in Brussels.

According to Saariko, a significant step forward was achieved in the meeting in drafting the EU's future financial rules. The goal is that the commission will be able to issue its legislation on the new financial rules during this year.

– From Finland's point of view, the conclusions were easy to accept. The core message is the commitment of all member countries to the rules. After all, such rules have no function if no one follows them or if they mean nothing in the economic policy of the member countries.

Plans to be comparable

Member countries' commitment is increased by drawing up even more personal and individual medium-term plans that suit the economy.

Saarikon according to individual plans, there are still details that need to be agreed upon. According to Saariko, they should be comparable among member countries.

– Thus, the level of requirements for them is also equal from the Commission.

According to Saariko, nowadays, for example, statistical methods differ between member countries.

Investments as part of debt

According to Saariko, there was also unanimity at the meeting about simplifying the rules.

It is good for Saariko that there is no change in the conclusions to the “three and 60” rule, i.e. three per cent deficit rule and the 60 per cent debt to gross domestic product ratio rule.

– So now we don't want to touch the core figures of the basic agreement.

According to Saariko, it was also good that investments were not separated from other economic policy.

– Investments are considered a similar debt, even if they are taken for a good reason. However, a debt is always a debt.

According to Saariko, it is also good that there is no attempt at joint debt.

Fiscal policy guidance for next year

Another entity at the meeting was fiscal policy guidance for the year 2024.

– Finland has been particularly careful that the state of emergency, i.e. the rules being on the shelf, cannot be continued indefinitely.

The rules have been shelved because of the crises.

According to Saariko, the Council was not satisfied with the Commission's communication last week, which foresees new rules. The Commission's announcement anticipates what the future legislation will be, even though no consensus has been reached.

– We had a quick discussion about this in the direction of the Commission.

Because of the consensus there are no new regulations, according to Saariko, the best option would be to return to using the old regulations next year, which have been on the shelf during the crises.

– The worst possible option is that the EU member states would end up continuing in an intermediate state where no rules apply to the economies. The second worst option is to go based on the communication issued by the commission next year.

The situation of the US banks was not visible

Saarikko also spoke about the extraordinary collapse of two US banks .

According to Saariko, according to current information, the deposit flight and market unrest seen in the United States has not been seen as alarming in European banks. However, he stated that the situation must be monitored without sensitivity.

– Fortunately, there are no direct similarities to the financial crisis in 2008. Since the financial crisis, we have strengthened European banks with significant regulation.

The US applied post-financial crisis banking rules to large banks, which now collapsed banks were not included. In Europe, on the other hand, banking regulations are aimed at banks of all sizes.

Inflation higher in Finland

According to Saariko, the task of the European Central Bank is not particularly easy now. The increase in interest rates in the United States had the effect that it happened to the banks that were in trouble.

The central bank's assessment is also influenced by the fact that inflation is still high in the euro area, including base inflation, i.e. not only the effect due to energy prices. That is why, according to Saariko, the development of wages must be monitored.

Salary moderation has been maintained in salary negotiations on Saariko in Finland. In Finland, inflation is now slightly higher than the average in the euro area. According to Saariko, the reason for this is that Finnish mortgages are strongly tied to the development of interest rates.

– It can be seen in the livelihood and survival of Finnish households.

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