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Overcoming the Financial and Debt Crisis in the EU and Preserving the Stability of the Eurozone

Speakers
HE Dr Janos Martonyi, Minister of Foreign Affairs‚ Republic of Hungary

 Date
09 Nov 2011

 Venue
Meeting Rooms, 301-302, Level 3, SUNTEC Singapore International Convention & Exhibition Centre, 1 Raffles Boulevard, Singapore 039593

 Time
2.45pm – 5.00pm

 Downloads





Dr Martonyi shared his thoughts on the unfolding of the eurozone crisis at the EUC’s Distinguished Speaker’s Lecture, held at Suntec City Convention Centre on 9 Oct. This Lecture was supported by the Ministry of Foreign Affairs, Singapore.

He began by discussing the political and economic coordination of the eurozone, which he believes will be strengthened as a result of the financial crisis. Hungary held the Presidency of the Council of the European Union earlier this year. One of its successes during this time was the approval of the so-called ‘six pack’ legislation, a package of six legislative proposals aiming at improving economic coordination amongst members of the eurozone to prevent future debt crises.

Politically, he stated that the EU still needs to put its own house in order, and to adapt the institutional system to current challenges. Borrowing terminology loosely associated with one of the EU’s founding father, Jean Monnet, he foregrounded the ‘community method’ and stressed his preference for a ‘strong and united Europe’, as opposed to the creation of a two-speed Europe, which is currently being debated.

He stated that with fiscal discipline, austerity and growth generation and creation measures, it is possible to find a way out of the crisis. He recalled Hungary’s past experiences and current financial recovery. It sought a $25 billion joint rescue package from the International Monetary Fund, the EU and the World Bank in October 2008, as at the beginning of the global financial crisis, investors were pulling out of developing economies, including Hungary, whose banks were heavily exposed to foreign financing. Its GDP grew by 1.2% in 2010, and is projected to grow by 2.8% in 2011, and it is currently running a trade surplus of $7 billion for the 1st half, of 2011 (IMF).

Beyond the urgent need to address the immediate problems posed by the debt crisis, Minister Martonyi in his lecture also spoke of the importance of the EU in getting its relationships with Turkey and Russia right. The relationships with these two key countries according to him will impact the future of Europe as a whole in the long term.

Dr Martonyi also fielded questions from the audience in a half-an-hour dialogue session chaired by the moderator, Dr Yeo Lay Hwee. Questions were asked about generating growth in an environment where public and private deleveraging was expected, the issue of Eurobonds, and the stabilisation of markets. Regarding moving toward a fiscal union, he replied that it was unlikely, though stronger coordination and supervision are necessary and likely in the future.

When asked about his views on the future of the EU, he reminded the audience not to be overly pessimistic about the EU despite the many challenges  the EU is currently facing, as it still has continued importance internationally, especially in the fields of international trade and development aid. He also cited its many prior achievements, its strong institutional structure, the interconnectivity of issues and the stake all member states have in each others’ future.

At times phlegmatic and even at moments sanguine about future prospects, Dr Martonyi gave an insightful, pertinent and timely lecture.

View pictures from the event.

This event was reported in Channel News Asia (external link).