3 Giugno 2012

The fiscal situation of Greece started to decline since 2008. The European Commission was aware of this but did not react in time -as a matter of fact some countries treated Greece in a, let us say, Shylok’s  spirit. Do you think that the EU also bears responsibility for our country’s collapse ?

This is a question that has already been written about a lot and my mandate at the European Commission ceased end 2004. I think we need to look ahead, not back, to what needs to be done and wh ere our common interests lie.

Was it necessary for the eurozone to invite the IMF to participate in the economic support mechanism for Greece? Didn't Europe have the means to deal with the crisis o r did Greece serve as a "guinea pig" in order to intimidate other countries with deficit  problems of the consequences?

Again, I don’t think it is useful, at this stage, to analyse the past management of the crisis. The EU and the IMF are providing financial assistance, and Greece needs to continue to build on the substantial work it has already done to cre ate a stronger economy, as the people of Portugal and Ireland are doing.  The Italian people are also h aving to accept sacrifices to achieve a balanced budget next year and put the debt firmly on a downward path. At the same time they are contributing a significant share of the assistance to Greece and the other countries in need.  We must focus on the efforts that are required and  which can be alleviated with a stronger emphasis on growth-enhancing  measures.

Do you think that Greece could renegotiate the Memorandum? In your opinion, which specific aspects could be changed? If the Greek government run out of money at the end of June would you recommend a bridge loan until the troika evaluation?

It would not be responsible for me to speculate on what the government formed after the elections will do, nor what EU Member States would decide collectively. I sincerely hope that the Greek people will vote to keep the euro, because it is the best guarantee of a stable and prosperous future. Too often in the past governments in Greece and elsewhere yielded to short term policies that led to high debts and competitiveness problems which they tried, and failed, to resolve through currency devaluations that merely resulted in higher prices and interest rates. The euro forces discipline on politicians. They did not understand o r accept this during the first 10 years of the monetary u nion. But this discipline is the best guarantee for citizens that political decisions take account of the general interest,rather than  the interests of organised groups, political clienteles o r of politicians’ careers.

It is clear that deregulated markets did not achieve the results intended both in the United States and the European U nion (banking sector). Is there a need of  a new regulation scheme and a more active role of the state?

I believe a lot has been done and continues to be done to better regulate and supervise markets and financial institutions. However the situation we are in at present goes deeper and  has to do with the vicious interaction between the necessary reduction of debt levels,the recessive effect this is h aving on the economy and, consequently, on banks. Put more simply, as the State spends less and taxes more, people see their purchasing power diminished, which is in turn causing lay-offs and  plant closures, resulting in an increase in bad loans for the banks. The way to break this vicious circle is to find a middle ground between that stimulate growth and budgetary consolidation and measures that stimulate growth and cre ate jobs, bearing in mind that there are no quick, one-size-fits-all solutions. The May European summit already provided some welcome answers, for example by favouring targeted investment. To give you another example here in Italy we are fighting to avoid a second VAT increase in a year, by carrying out a relentless fight against tax evasion and reducing spending that is not strictly necessary.

In your opinion is Europe doing enough to cre ate a new architecture in the financial markets and to review the role of the credit rating agencies? Is the European Central Bank doing enough to help solving the crisis? Should it be more active in bond markets?

I think the ECB has done an excellent  job to help the euro area throughout this crisis.I am sure that it will continue to do whatever it deems necessary and appropriate to preserve the euro, in the full independence that was conferred on it by the Treaty and which is crucial for its credibility. 
Are you aware that the European institutions o r even some national governments are preparing for a possible exit of Greece from the eurozone? Do you fear that if Greece is forced out, the contagion will spread to other member states?

I am sure Greece will stay in the euro area because, above all, I am profoundly convinced this is in the best interest of the Greek people.
Do you believe that the eurozone has reached a crunch time between moving forward to a closer fiscal u nion  o r facing the danger of a break up?