Budget carriers require strict rules for emergency loans to the ESM

Ten budget hawks The so-called Hansan 2.0 group presented its point of view in a letter dated November 1, before the Eurogroup meeting on Monday.

At the autumn bargain l & # 39; EUcountries on how to strengthen the ESM and the Banking Union and EMU thorough. Finance ministers will decide in December. On Monday, the Eurogroup will discuss further.

The ten countries Wishes the ESM to remain an intergovernmental institution and not be transposed into the Treaty on the European Union. As a result, each euro country continues to veto the emergency loan decision.

The ESM is the last credit institution in the eurozone countries. But the first line of defense must be at the national level: a sound fiscal policy in line with the Stability Pact and decisive structural reforms, they wrote.

They want to divorce The role of the European Commission and ESM. The role of the Commission is to coordinate the EU's economic policies. ESM is responsible for assessing and approving the terms and conditions of emergency loans, including budget rules and loan terms.

Budget hackers often consider that the Commission can more easily apply the EU's fiscal rules.

Since the EU treaty explicitly forbids EU countries to take over the debts of other countries, emergency loans must be repaid, Hansan wrote 2.0 in the letter.

ESM must therefore ensure that the borrower can repay in advance. ESM will conduct an independent assessment taking into account the long-term debt sustainability considered by the ten countries.

Do not blame Should be too broad if a collective action clause was to be introduced so that unanimity is not required among lenders for debt cancellation. This will be enough for a large majority.

In addition, the management of the environment requires sufficient resources to maintain the expertise. ESM will participate in the design and monitoring of the rescue programs.

Of the ten Countries have three non-euro countries: Sweden, Denmark and the Czech Republic. The seven countries in the euro area are the Netherlands, Finland, Ireland, Estonia, Latvia, Lithuania and Slovakia.

For Sweden, Denmark and the Czech Republic, it is important that the seven countries help them to participate in the banking union under the same conditions as the countries of the euro area, "including in terms of financial conditions and of governance ".

At present, only euro area countries participate in the banking union. Countries not belonging to the euro area have the right to participate but do not have the same influence in the decision-making process.

Hansan 2.0 was formed by jol. In September 2017, they marked their opposition to the new instruments of support for the EU's long-term budget for the 2021-2027 budget, in the form of a budget in euros.