The Irish Presidency has this morning helped broker an agreement on behalf of EU member states on new rules to stabilise eurozone economies known as the 'Two Pack.'
The new rules, the ‘Two Pack’, will improve budgetary and economic coordination among eurozone countries. Agreement was reached after talks this morning with the European Parliament and the European Commission.
The Irish Minister for Finance, chair of the ECOFIN Council, Michael Noonan said:
"I very much welcome this morning’s agreement on the ‘Two Pack’. This is a key piece of the eurozone’s economic architecture and has been an Irish Presidency priority."
The agreement reached today will have to be approved by member states Ambassadors, as well as by Council and Parliament before becoming law.
What is the ‘Two Pack’?
The economic crises of recent years showed that while European countries shared a common currency, their economies were not sufficiently coordinated. The ‘economic’ part of Economic and Monetary Union needed to be strengthened. The ‘Two Pack’ is the response, introducing new rules to help stabilise the eurozone.
In 2011, six new sets of rules, the so- called ‘Six Pack’, came into force to strengthen economic coordination among EU member states. European countries agreed to share information and coordinate their national economic and budgetary plans. But the 17 eurozone countries needed further rules – these are in the ‘Two Pack’.
The ‘Two Pack’ consists of two regulations: one with special measures for monitoring and assessing plans of countries with high, excessive government deficits; and another with special measures for countries experiencing severe financial difficulties, such as those emerging from an EU-IMF programme.
The agreement reached with the European Parliament includes a commitment by the European Commission to set up a working group to study, amongst other issues, the feasibility of creating a debt redemption fund for eurozone countries with excessive sovereign debt.