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European Commission

[Check Against Delivery]

José Manuel Durão Barroso

President of the European Commission

Remarks by President Barroso following the first session of the European Council

Press conference

Brussels, 21 March 2014

Let me add to the very comprehensive and accurate description of the conclusions of the European Council by President Van Rompuy some of the points that are especially important in the view of the European Commission.

First, regarding Ukraine.

I welcome the fact that we were able to show strong and united determination. Not only supporting Ukraine but also making clear that there will be consequences for some of the kind of behaviour that we think is simply unacceptable in the 21st century.

We made very clear that we will deliver our strong and concrete support to Ukraine. It's essential that this country becomes a viable, stable prosperous and democratic country.

We have decided concretely to go on with the plans that the Commission had already put forward, namely the proposal for an additional 1 billion euros of macro financial assistance, which will bring our overall support to 1.6 billion. And also the autonomous trade measures we proposed to open unilaterally our market to Ukrainian products.

This is very important as is also the fact that tomorrow we are already going to sign, with the Prime Minister of Ukraine, the political provisions of the Association Agreement to seal the strong political partnership that brings Ukraine and the EU closer together. This is the democratic choice Ukraine has made. It is our firm intention to sign the remaining parts of the agreement in due course. Europe is committed to Ukraine for the long term. We will help Ukraine to reform and consolidate its independence and sovereignty.

At the same we also took decisions – and I will only refer to those that have a clear implication on the European Commission's work – on the consequences for the behaviour that has been in place recently. Our conclusions of the European Council make it clear when they say 'the European Council asked the Commission to evaluate the legal consequences of the annexation of Crimea and to propose economic, trade and financial restrictions regarding Crimea for rapid implementation'. This specifically on the issue of Crimea.

And we have also decided, apart, I repeat, from all the other political measures the President of the European Council mentioned, that the Commission will prepare possible targeted measures. I quote the text: "The European Council recalls that any further steps by the Russian Federation to destabilise the situation in Ukraine would lead to additional and far reaching consequences for relations in a broad range of economic areas between the European Union and its Member States on one hand, and the Russian Federation on the other hand. In this respect, the European Council asks the Commission and the Member States to prepare possible targeted measures."

So I think these are the two main elements regarding Ukraine. First of all, the support and commitment of all Member States to support Ukraine as a democratic, sovereign and stable country, and also the decision to take strong measures, if needed, more measures, to show to Russia that some of this behaviour is simply unacceptable.

But we also have discussed economy. And the day started very well, with very positive news of the agreement on a Single Resolution Mechanism for banks. This was the missing part of the banking union. This agreement will strengthen confidence and stability in the financial markets. And – very importantly – it should help restore lending to the economy. So it is good news for the economy, but it's also good in terms of fairness. In the future, it is banks who will pay for their own failures, not taxpayers.

This sense of fairness is also reflected in the agreement tonight to agree on the revised directive on taxation of savings. It took six long years of negotiations, but we did it. We are bringing an end to banking secrecy in Europe. And we will be in a strong position to negotiate with key international financial centres. I hope we can achieve real progress in this matter by the end of this year.

I am also especially pleased with the very good discussion we had on growth. Growth is returning. We also heard the assessment by the President of the European Central Bank regarding the improvement in the conditions in the euro area and in the European Union in general. In fact while some risks still exist, it is now clear that recovery is there, but we have to work to make sure that the recovery will last. We must keep the pace of the necessary structural reforms.

And we have to take special attention – of course – to the issue of unemployment. Not only the high level of unemployment that is unacceptable from a social point of view, but also as it has a negative impact on the growth potential of Europe. Because so far our countries have been making a huge effort, for instance, in terms of correction of external imbalances, but the growth that is available is mostly a growth based on exports – which is very good as it shows increased competitiveness of many of our economies – but we also need a growth that is more based on internal demand: consumption and also investment. And this is why employment, apart from the social drama that it represents, it is important that employment contributes to sustained growth.

It was an interesting discussion. I'm very happy that the Member States agreed on very concrete language. So I except Member States to send us their plans next month, and that they reflect in those plans this ambition for reform. Today's European Council has given a clear endorsement in that sense. The crisis, as you know, has had a serious impact on many aspects of our economic and social life, including on the Europe 2020 targets, and so reforms are a crucial tool to address this challenge.

Another key ingredient is the need to maintain a strong industrial base. I’m pleased that the conclusions strongly reflect the Commission’s ideas on how to foster what we have called an industrial renaissance in the new economy that we are building post crisis.

To conclude, I’m extremely pleased with the unity and determination around the table, not only on the general assessment of the economy and the commitment to support the recovery but also on the concrete agreements that have been taken today on banks, Single Resolution Mechanism and fair taxation.

Thank you.

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