The economic impact of the crisis in the Middle East and the European response strategy are the focus of the Eurogroup.
Critical messages on the path of the European economy were sent by Eurogroup President Kyriakos Pierrakakis, coming into today’s meeting in Brussels.
The Greek minister and head of the body stressed that the tension in the Middle East creates a fluid environment, with the final outcome directly depending on the length of time the unrest lasts.
Mr. Pierrakakis set the context for the discussion, noting:
“One key word is ‘uncertainty‘ and a second word is ‘duration‘. The depth of the impact will in itself be the determining factor in this equation of the overall economic outcome that we will see in the coming months.”
The Eurogroup president explained that the European reaction will escalate depending on developments, stressing that:
“The debate is different if we are dealing with a two-week crisis and different when the crisis has a duration of two or three months. And obviously, that will affect the European response.”
About the energy prices, he noted that “every government is taking measures at the moment. There is an impact from the crisis in the Middle East that is being felt by every household and every business in Europe,” noting the need to coordinate the response.
He made clear that the European Commission has stressed that measures should be targeted, temporary and adapted. “We believe that such measures have the maximum impact to protect the most vulnerable citizens and our economies in general.”
In response to a question about the change attempted in the operation of Seaway of Hormuz and the imposition of tariffs, the Eurogroup president stressed that “freedom of navigation and not making the Strait of Hormuz a ‘toll’ is absolutely essential. We support by diplomatic means any initiative that moves in this direction”, while noting that he understood the concerns, coming from a maritime country.
Today’s Eurogroup agenda, he said, “is dense” and includes “banking integration in Europe, and how startups can become scale-ups in Europe as part of the Savings and Investment Union and the removal of barriers.”
On banking integration, “we need more integration in Europe. We need more cross-border mergers and acquisitions. That is absolutely right.”
