The Economic and Financial Affairs Council was held in Brussels on 20 January 2009. The following items were discussed:
Presidency work programme
The Czech presidency presented its ECOFIN work programme for the first half of 2009, which received full backing from Ministers.
Follow-up to the December European Council: Impact on Council Work
The presidency took stock of the work arising from the European Economic Recovery Plan (EERP) agreed by the December European Council. Ministers discussed the next steps for two particular issues. The first was reduced rates of VAT. The presidency pledged to find a compromise at ECOFIN in the coming months. The second was how the EU budget can best support infrastructure and energy efficiency projects. Ministers agreed to return to this issue in February. On both issues the Government support the presidency’s strategy for finding agreement.
Economic and Budgetary Policy Strategy for 2009, including economic and financial situation and implementation of European Economic Recovery Plan
Ministers exchanged views and adopted an external communication on the economic and budgetary policy messages for ECOFIN’s work in 2009. This included discussion of the impact of fiscal stimulus packages on budgetary rules under the stability and growth pact.. The presidency will use the messages at this ECOFIN to inform discussions at the spring European Council in March.
Introduction of the euro in Slovakia
The European Commission and the representative of Slovakia presented a first assessment of the introduction of the single currency in Slovakia on 1 January 2009. The Council congratulated Slovakia on its success.
Western Balkans Investment Framework
The Council heard a report and adopted Council conclusions on progress towards the establishment of the Western Balkans Investment Framework by 2010.
Balance of payments assistance—Latvia
Ministers adopted Council decisions granting balance of payments assistance to Latvia. The UK supports this loan, which is part of an overall package of support agreed with the IMF, World Bank, and bilateral lenders.
Financial rescue packages and bank capital
The Czech presidency reminded Ministers of ECOFIN’s commitment to ongoing monitoring of the progress and effectiveness of national financial rescue measures. The presidency emphasised the need for member states to continue to co-ordinate their actions. Ministers adopted Council conclusions on bank capital, agreeing to take strong and decisive actions to stimulate their economies, provide liquidity, strengthen the capital of financial institutions, protect savings and deposits, address regulatory deficiencies and unfreeze credit markets. The Commission will prepare reports on the implementation of rescue packages and on troubled assets for the March meeting of ECOFIN, when the matter will be revisited. The UK strongly welcomes this work, which is an essential part of wider efforts to restore stability to financial markets.