Jyrki Katainen: In times of budgetary constraint, we have to get more for each euro spent
Europe is not just a geographical entity: it is a commitment to a set of values which we must never be allowed to take for granted. In recent years, Europe has been hit by the deepest financial crisis since the 1930s. The social cost of the recession has been enormous, and many feel that Europe has failed to safeguard stability and welfare. Others feel that they have had to pay for others' mistakes.
We must respond to their concerns and bridge the divide. Our most important challenge today is to create the right conditions for sustainable economic recovery, growth and jobs. European regions and cities are crucial partners in our common efforts to find a way out of the crisis; they are places where new ideas and start-ups can grow, places of hope and faith in the future. To support this process, sound public finances and reforms are also needed at local and regional level, and should be aligned with the principle of fiscal responsibility. In times of budgetary constraint, we have to get more for each euro spent. European Structural and Investment Funds have a budget of EUR 351 billion (32.5% of the overall EU budget for 2014 to 2020) and are important tools for investment and innovation which can boost recovery, growth and social cohesion.
We can now see signs of a turnaround in the economy, including in countries hardest hit by the crisis. They have made a concerted effort to rebuild their economies, in very difficult social circumstances. However, recovery is still fragile and unemployment, especially among young people, is still far too high. Strong policy action - at national and EU level - needs to continue. The three key words are investment, reform and stability.
First, growth and job creation require investment. For investment to flow, we need a favourable business environment and a service-oriented public administration, also at national, local and regional level. We need a stable and robust banking sector and efficient capital markets to provide accessible credit for households and SMEs, and to channel savings into infrastructure and industry, education, research and innovation.
Second, Member States must continue to reform their economies, boost competitiveness and create more dynamic and inclusive labour markets, which also applies to local and regional authorities.
And third, building on past achievements, fiscal consolidation needs to continue to address the high levels of debt that still exist. However, fiscal strategies must be both growth-friendly and fair. They must focus on the quality of public finances, rationalising current expenditure while maintaining targeted public investment in people as well as in projects.
Jyrki Katainen , EU Commissioner for Economic and Monetary Affairs and the Euro
Jyrki Katainen
Jyrki Katainen is the EU Commissioner for Economic and Monetary Affairs and the Euro and Vice-President of the European Commission. Before joining the European Commission, he served as Finnish Prime Minister from 2011 and Minister of Finance from 2007. He has also been active in local politics; his first formal political position was as member of Siilinjärvi Municipal Council in 1993. He was then elected to the Finnish Parliament from the district of Northern Savonia in 1999, served as the Vice-Chairman of the National Coalition Party in 2001, and became its leader in 2004. As a member of the Finnish Parliament, he was also chairman of its Committee for the Future. Vice-President Katainen has initiated a number of reforms focusing on support for innovation, investment and entrepreneurship, particularly start-ups. In 2013, he invited participants representing political parties, interest groups and research institutes to attend a forum at the Heureka Science Centre. The forum aimed to explore the broad structural changes needed to improve Finland's economy over the coming years. In 2013, he was also a keynote speaker at the annual "Slush Helsinki" event, attended by around 5 500 entrepreneurs and investors. He has stressed that entrepreneurs have a positive attitude: they believe that despite the possibilities of failure in the high-tech industry, there is faith in the future and tremendous opportunities in Finland for people who want to change the world.
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