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José Manuel Durão Barroso

President of the European Commission

Statement of President Barroso at the pre-European Council debate

EP Plenary

Brussels, 2 February 2011


Honourable Members,

This European Council takes place at a very important moment for our neighbourhood, namely in Egypt, Tunisia and Belarus. While respecting the different specific situations in these countries, I expect this European Council to state in very clear terms that the principles of the rule of law, respect for fundamental rights and a pluralist democracy must be enacted and respected: Democracy is indeed the best way to achieve stability and prosperity in those countries just like anywhere else.

This Friday, the European Council will discuss two areas which are also very important for the future of Europe and its economy: energy and innovation.

Both of them are core elements of the Europe 2020 Strategy, and central to our aim of restoring sustainable growth and increasing the European Union's competitiveness.

And let us not forget that energy and innovation are also two fields where the Community approach and European dimension can offer a lot of value-added. This is an important point to make in the current context.

Through the Europe 2020 Strategy, we have already agreed on a set of ambitious goals and targets on energy and innovation. I could mention the Innovation Union flagship, adopted last October, or the Resource Efficient Europe flagship, adopted just last week and in which energy features prominently.

So this week's European Council should identify clear, concrete deliverables. The discussion and the outcome should be as operational and productive as possible.

I have described energy policy as the next great European integration project. And it's not hard to see why. A safe, secure, sustainable and affordable energy supply is key to our economic and strategic interests as a global player.

We have already done a lot in the past with our Climate and Energy package and with internal market legislation. We must build on that by exploiting the opportunities provided by the Lisbon Treaty, deepening our existing co-operation and launching initiatives in new areas like energy security.

Therefore the first credibility test of our energy policy is delivering what we have already agreed upon.

The Commission has outlined the measures we think are urgently needed in our Energy 2020 and Energy Infrastructure Communications. I want the European Council to endorse these priorities and, in particular, make a clear commitment to complete our internal energy market by 2014. A common technical standard should also be fixed for electric vehicle charging systems this year, as well as for smart grids and meters by the end of 2012.

A truly integrated internal market on energy is key to deliver more growth and jobs, promote technological progress, modernise our infrastructure and reduce our exposure to import and price volatility.

We must also ensure that when it comes to energy, no Member State is isolated from the rest of Europe. I want Member States to agree on a 2015 deadline to put an end to energy islands in Europe.

We have done good work in connecting the Baltic countries to the continental system. Now I will turn to Central and Eastern Europe to move forward the North-South Energy Interconnections. I want a plan to be agreed in autumn on the projects needed to link the Baltic to the Adriatic.

While we are on track to achieve our renewables target, on present performance we will only meet half of our energy efficiency target.

More efficient energy use is the key to unlocking massive environmental and economic benefits - and reducing Europe's annual energy bill by around €200 billion. It could also create 2 million jobs by 2020.

So I will ask the European Council to give new impetus to our pursuit of energy efficiency. We could use the scale of public procurement across the EU to give a real boost to energy efficiency – and this means local jobs, jobs that cannot be outsourced, jobs for SMEs, and real savings for both industry and households.

The Commission will adopt in the coming weeks an Energy Efficiency Plan proposing specific measures to boost energy efficiency. For instance that by 1 January 2012 all Member States include energy efficiency standards in public procurement.

The Commission will then review the progress achieved with these measures by 2013 and will consider further measures - including proposing legally binding targets - if necessary.

Member States should agree a deadline for including energy efficiency standards in all public procurement for public buildings and services.

For its part, the Commission stands ready to explore new measures in the fields of energy saving for cities, sustainable biofuels, smart grids and energy storage.

We also need to focus on the external dimension of European energy policy. Just a fortnight ago, I had encouraging discussions with the Presidents of Azerbaijan and Turkmenistan on Europe's access to the Caspian gas fields which would enable the realization of the Southern Corridor. An important breakthrough was achieved with the signature of a Joint Declaration with Azerbaijan and a concrete commitment from Turkmenistan to supply gas to Europe.

The message I took from that visit is this: when we take key decisions on energy jointly in Europe we are a strong player in the global race for energy resources. Underlining the importance of the external dimension of EU energy policy should be a key message from the European Council. So I am looking forward to a very important discussion on energy at this European Council and I am happy to say this here in the European Parliament. This Parliament has always been very supportive for a strong European policy on energy and you, yourself President Buzek, have been a champion of a stronger commitment in Europe in terms of energy policy.

Moving to innovation, I think there is already broad agreement about what should come out of the European Council. Perhaps less evident is a sense of how desperately urgent action is; why boosting research and innovation is needed now, when Member States are all making difficult choices about where to cut their budgets.

Fiscal consolidation and public support for innovation are not irreconcilable policies. Several Member States have shown that you can cut your overall budget while maintaining growth-friendly expenditure, in particular on research and innovation.

This is important, because delivering the innovation economy is the key deep structural challenge. Our competitors know this. They are already betting on innovation.

To avoid being left behind, we need the European Council's endorsement of our Strategic and Integrated Approach to Innovation. Innovation needs to be part of our economic policy, not simply a research instrument, as some people think.

At the European level we can add real value by improving the framework conditions for research and innovation in the EU. Europe must become the natural home of innovation, through effective standardisation, better use of intellectual property rights, innovation-friendly public procurement and measures to help small, innovative companies to secure financing.

Much of this does not cost money, but it does need political will and political will to take measures using the European approachand the European dimension.

We can also squeeze more out of the European Research Area, making full use of the single market by improving the mobility of researchers, for example.

And as well as maintaining spending, we need to spend better. With the Budget Review we have launched a debate on how to simplify the way EU money is spent, and to work towards a common strategic framework for research and innovation funding.

In other words, getting better value for money also means cutting red-tape, so that EU-funded scientists can spend more time in the lab or in their work, and not with red tape and bureaucracy. We will never attract the most brilliant scientists and most innovative companies with an incoherent set of funding instruments, based on complex and bureaucratic rules.

Ladies and gentlemen,

So this month's European Council will discuss energy and innovation. But it will not avoid discussing the economy. The economy, the problems of the unemployed – this remains the most important concern for our citizens.

We have just launched the first European Semester – putting economic governance into action. The Annual Growth Survey was well received. The messages were focused and clear. It provides the necessary guidance at EU level so that Member States can take our interdependence into account when making their national policy decisions.

Good progress has already been made on the legislative proposals that will underpin our new system of economic governance. I would like to thank the Hungarian Presidency. The Hungarian Presidency has my full support in accelerating work to ensure adoption by June.

In addition, as part of this comprehensive response, we will need to resolve the outstanding issues surrounding the European Financial Stability Facility and the European Stability Mechanism.

Regarding the EFSF, other than widening its scope, what is a stake is how to increase its effective lending capacity – as stated by the Commission in the Annual Growth Survey.

Of course, this issue should be put in the context of the comprehensive response. The discussions in the European Council of Friday next will most likely cover the need for reinforced coordination of economic policies in the EU and the euro area. I welcome such discussion, which fits very well with the Commission's Annual Growth Survey. In fact, the European Semester is not just about co-ordinating budgetary policies, but addressing wider issues like macroeconomic imbalances and competitiveness gaps.

In addition we have recently heard some authoritative voices arguing in favour of deepening economic governance, but at the same time stating that it can only be done through the intergovernmental method.

We have to be clear: the Commission welcomes the deepening and acceleration of economic governance and policy co-ordination, including within the euro area. But we are firmly convinced that the Treaty provides the right framework and instruments to achieve this. In fact, we would not further our cause if parallel structures were to work in an ultimately incoherent manner.

Establishing a system of reinforced economic governance for the EU, and in particular the euro area outside the Union framework raises important, and politically very sensitive, questions. In fact Member States should adopt measures which are fully compatible with the Community method and the framework provided by the Treaty. Insofar as measures fall under national competence, and of course some of them are under national responsibility, this competence should be exercised in coherence with the overall Union framework.

So I really believe this matter is extremely important, because we can make a great progress in matters of economic governance. We need, and we have been in favour of, more policy coordination, better economic governance, but we have to do it in a way that is coherent and compatible with the treaties and with the community approach.

The Commission will be particularly attentive to these issues. The Treaty, and the ensuing "community method", implies fully respecting the role of all the European institutions.

I thank you for your attention.

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