As G20 leaders gather in Cannes, the world is looking for a sense of urgency and common purpose to restore confidence and bring the global economy back on track.
Europe was instrumental in establishing the G20 leaders' process in 2008. Since then, the G20 has become the premier forum for global economic coordination. The Cannes Summit must renew the collective spirit of the G20 and send a bold message that we will not allow the world economy to falter again.
The sovereign debt crisis of some of our EU member states will be in focus in Cannes. Many of our partners fear that if Europe does not solve this crisis, there may be dangerous spillovers to the global economy.
I can reassure them: The EU is coming to Cannes to show that we are living up to our responsibility. The European summit meetings last week illustrated this determination: we are bringing Greek debt back to sustainable levels; we have built important firewalls to avoid contagion; we are restoring confidence in the European banking sector; we are accelerating our agenda for growth; and we are building a true economic union, which complements the existing monetary union through unprecedented levels of policy coordination and surveillance.
By the end of this year, the Commission will have presented all its proposals on overhauling the banking system, in line with our G20 commitments. That means more than 30 pieces of pan-European legislation – all of which aim to make the sector more responsible and to restore its position as a service to the real economy.
Europe is the first constituency in the G20 to have started the legislative process to implement Basel III requirements. Europe is also first to have proposed a financial transaction tax, which we shall present in Cannes. This is a question of fairness. If all other sectors of the economy, from industry to agriculture, pay a contribution to society, the banking sector should also pay its share. This type of response is of course most effective on a global scale, where it can be used to address global challenges, such as the fight against poverty.
We call on our G20 partners to show the same level of ambition. Let me outline the key priorities on which we want to see progress in Cannes:
• Restoring global growth and tackling global macroeconomic imbalances through the G20 framework for growth constitutes our first priority. In this context, Europe will push in particular for an ambitious action plan to which all G20 members should contribute, some through credible medium-term fiscal consolidation plans, others by further rebalancing their domestic economy in the short term and improving exchange rate flexibility.
• We need to make tangible progress on implementing our financial market reform agenda and accelerate work on over-the-counter and commodity derivatives, banking crisis prevention and resolution. Further work is needed to agree ambitious measures on systemically important financial institutions and shadow banking, and paving the way towards single, globally accepted accounting standards.
• Making the international monetary system more resilient, including through ensuring adequate resources for the IMF, is equally important.
• We should also boost trade as the most effective way to support global growth. We want the G20 to commit to a roadmap for an active Doha negotiating agenda, in particular for least-developed countries, as well as on broadening the scope of issues being considered by the WTO in order to address new global challenges. The G20 should also renew its commitment for openness and against protectionism, and ensure a global market for raw materials that is undistorted, sustainable and transparent.
• Finally, we must keep employment and poverty reduction at the centre of our attention and live up to our responsibility on issues like climate change, development and global governance.
The EU is coming to Cannes with ambition and solutions. We are determined to make decisive contributions to the strong G20 responses that our global economy so badly needs and our citizens have the right to expect.
José Manuel Barroso is president of the European Commission