Speech: Remarks by First Vice-President Timmermans at the European Parliament on the preparation of the G7 Summit

Madam President, Honourable Members,

President Juncker is travelling as we speak to the G7 Summit in Japan and has asked me to address you on his behalf, ahead of a summit that will address a number of urgent priorities.

The economic backdrop is one of gradual recovery for our economy, despite a difficult global environment. EU annual growth reached 2% in 2015. Our first-quarter growth this year was higher than that of the United States.

Unemployment is certainly still much too high in some Member States but, across the board, it has fallen to its lowest in five years. Today, there are five million more jobs than in 2013.

Confidence is gradually returning - we see it on investment, on consumer spending, on lending. But we must remain alert. Our main trading partners' slower performance is a cause for concern. Last year, growth outside the EU fell to its slowest since 2009 as emerging markets performed less well.

Against this backdrop of uncertainty, growth will depend on the opportunities we create for ourselves. We need investment, structural reforms and responsible public finances. We need to stay the course.

This Parliament has played a vital role in the strategy. You made it possible to launch the Investment Plan for Europe at record speed.

In less than one year, it has triggered €100 billion in new investments, and delivered finance on better terms to more than 140,000 SMEs.

It is generating structural change. Until now, European investment has often been dominated by a limited number of large, expensive projects. Today, we are starting to see more local projects, which are smaller and more diverse. Public money is mobilising private finance, and supporting structural reforms. We see more interaction between the European Investment Bank and local institutions. In short, we are beginning to see the kind of investment that the market has often failed to deliver.

Our Fund is helping to find new treatments for Alzheimer's disease; transforming old industrial sites into new offices; bringing energy efficiency into our homes and cutting our bills; and lending a hand to start-ups who were turned away by other lenders.

Investment is high on the agenda of the G7. And we have a good story to tell.

We will also deliver better news on Greece. Last year, we fought hard to keep Greece in the euro area. Today, the economic data is better than expected. Greece should return to growth in the second half of 2016. Unemployment fell in 2015, and the government reached a primary surplus of 0.7% of GDP. The stability support programme agreed last summer has laid the ground for long-term stable development.

Above all, we have managed to secure Greece's place in the euro area. This week's agreement on the completion of the first review of the programme only confirms that.

Discussions on reducing the Greek debt burden have now started. This recognises the collective effort made by the people of Greece. Today, the Greek economy can turn the corner, and we are confident that international investors will follow.

Within the G7, the European Union has always fought for a global economy that is governed by rules, increasingly transparent, and as fair as possible. In other words, we strive to export our best practices to the global stage. At this week's summit, we will continue these efforts.

Together with our G7 partners, we need to demonstrate that global trade can work for everyone - not just for every country, but for every part of our society.

We know that, in the short term, globalisation produces winners and losers. This has helped to fuel populist forces around the world. And so our challenge is not only to shape the rules of the game and to ensure that they are respected, but also to argue that our long-term prosperity lies in openness and exchange.

Over the last year, the European Union has taken the lead on tax transparency. We now have a ground-breaking agreement on tax rulings, and earlier this year we adopted a new proposal on country-by-country reporting.

Our message is clear: everyone must pay their fair share. We must now work with our G7 partners to ensure that this is a truly global effort. If our own Member States have agreed to put in place central registers of beneficial ownership, then our partners must do the same. For those that try to evade their duty to society, there must be no place to hide.

We must be equally firm on those countries that do not play by the rules. Free trade must be fair trade. I can assure this House today that the European Commission stands by a robust trade defence system. If somebody distorts the market, we will take action.

This Commission has launched a record number of trade defence measures to respond to the dumping on Europe's steel industry. At the G7, we will argue that offending countries need to produce clear and measurable plans to cut over-capacity. International monitoring must ensure that everyone complies.

Let me now turn to the global refugee crisis, which is rightly high on the G7 agenda. This Commission has argued from the start that only global solutions will work.

Here, once again, this Parliament has helped to deliver a European strategy that is comprehensive: saving lives at sea, providing humanitarian assistance, strengthening our borders, supporting the countries most under pressure, relocating and resettling people in need of international protection, returning irregular migrants to their home countries, and creating safe and legal routes for asylum-seekers from outside the European Union. In 2015 and 2016, the EU will have devoted more than 10 billion euros to managing the crisis.

This strategy has given us the breathing space to look to the future. Together with our G7 partners, we must now develop a truly global response, backed by proper resources, and capable of addressing the root causes of migration. An international resettlement programme is urgent and necessary. Only by giving asylum-seekers a legal route to safety will we convince them not to risk their lives.

This is the best way to break the business model of the smugglers.

And the best way to restore dignity to those who genuinely need our protection.

Let me conclude with climate and energy. This week's summit of the G7 is the first since the Paris agreement. The real work starts now: modernising our economy and changing the way we produce and consume. This in turn requires new incentives across the entire spectrum of policy.

The best of our businesses have read the signal: leading European companies are changing their business models, and creating new jobs that require new skills, innovative processes and investments.

The European Union must have the ambition to be a world leader in renewables - the sector now employs over one million people and generates 130 billion euros in turnover each year. European companies today hold 40% of all patents for renewable technologies.

But major obstacles remain. In 2013, across the world, subsidies for fossil fuels amounted to almost 500 billion euros. That's a lot of money being spent very badly. The G7 has promised to phase out those subsidies by 2025. Next we must push the G20 to do the same.

Madam President, Honourable Members,

As we approach this week's summit in Japan, the need for political coordination at the global level is as compelling as ever. From a slowing global economy to a global refugee crisis, the countries of the G7 need to show leadership and join forces.

As European Union, we will continue to make the case for a global economy that is governed by rules, and an open society that seeks prosperity and security in its exchange with others. In today's uncertain world, our contribution really matters.

Thank you very much.

SPEECH/16/1920

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