Two-Speed Europe?

Minister for Finance Magdalena Andersson

Stockholm 12 November 2015

Ministry of Finance Sweden Government Offices of Sweden 2 Challenging times for Europe

First time asylum applicants Percent of current population 2012 and 2014 1,8% 1,6% 1,4% 1,2% 1,0% 2012 2014 2015 (forecast) 0,8% 0,6% 0,4% 0,2% 0,0% SE HU AT DK DE BG NL BE IT FR EL UK Source: Eurostat.

Ministry of Finance Sweden Government Offices of Sweden 3 Other challenges

Climate External Security

GDP growth (y-o-y) 5 0

EU-sceptical -5 opinions Economic Growth

Ministry of Finance Sweden Government Offices of Sweden 4 Economic challenges

Figures for 2011 2012 2013 2014 • Diverging unit labour EU-28 costs Real GDP 1,7 -0,5 0,2 1,4 (y-o-y) • Low productivity and Public Debt 81,0 83,8 85,5 86,8 potential growth

Inflation (HCIP) 3,1 2,6 1,5 0,6 • High public and private debt Unemployment 9,7 10,5 10,9 10,2 • High unemployment - Youth 21,7 23,3 23,7 22,2 Unemployment • Ageing population

Ministry of Finance Sweden Government Offices of Sweden 5 Progress in some areas

• European Stability Mechanism • ECB – Outright Monetary Transactions (OMT) – Quantitative Easing (QE) • Reformed Economic Governance Framework • Banking Union • Financial support to crises countries

Ministry of Finance Sweden Government Offices of Sweden 6 Different ways to organise cooperation

Rely on Rules-based Institutionalised market discipline framework framework

Ministry of Finance Sweden Government Offices of Sweden 7

Current proposals

Economic Union

Fiscal Financial Union Union Completing the EMU

Political Union

Ministry of Finance Sweden Government Offices of Sweden 8 Possibilities and risks

+ Better coordination could lead to less economic imbalances within the Euro area

- Lack of popular support - Could increase the divergence between ins and outs within the European Union

Ministry of Finance Sweden Government Offices of Sweden

9 Are we moving to a Two-Speed Europe…

Steps are being taken to strengthen the Eurozone cooperation

Ministry of Finance Sweden Government Offices of Sweden 10 …or a Multi-Speed Europe?

EU Eurozone Schengen EFTA Fiscal compact Banking union FTT

Ministry of Finance Sweden Government Offices of Sweden 11 …or a Multi-Speed Europe?

EU Eurozone Schengen EEAEFTA EFTAFiscal compact Banking union FTT

Ministry of Finance Sweden Government Offices of Sweden

…or a Multi-Speed Europe?

EU Eurozone Schengen EFTA Fiscal compact Banking union FTT

Ministry of Finance Sweden Government Offices of Sweden

…or a Multi-Speed Europe?

EU Eurozone Schengen EFTA Fiscal compact Banking union FTT

Ministry of Finance Sweden Government Offices of Sweden …or a Multi-Speed Europe?

EU Eurozone Schengen EFTA Fiscal compact Banking union FTT

Ministry of Finance Sweden Government Offices of Sweden 15 …or a Multi-Speed Europe?

EU Eurozone Schengen EEAEFTA EFTAFiscal compact Banking union union FTT

Ministry of Finance Sweden Government Offices of Sweden 16 …or a Multi-Speed Europe?

EU Eurozone Schengen EEAEFTA EFTAFiscal compact Banking union FTT

Ministry of Finance Sweden Government Offices of Sweden 17 Cooperation constellations vary between areas

Internal market External trade

EU-budget Security policy priorities

Ministry of Finance Sweden Government Offices of Sweden 18 Swedish perspective

• Want to be an active EU member – even if we are outside the euro • Internal market regulations is a priority for Sweden • Reasonable with closer cooperation but require more transparency for the Euro-group • Common concerns should be discussed and decided by all 28 member states • New initiatives should be open for all 28 member states as far as possible

Ministry of Finance Sweden Government Offices of Sweden 19

Thank you!

Ministry of Finance Sweden Government Offices of Sweden