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Prime Minister Juha Sipilä’s announcement on Current EU agenda - Permanent Representation of Finland to the European Union : Current Affairs

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News, 11/24/2017

Prime Minister Juha Sipilä’s announcement on Current EU agenda

Photo: Finnish Government
Prime Minister Juha Sipilä.
Prime Minister Juha Sipilä.

Government Communications Department 22.11.2017 14.27
Prime Minister's Announcement
Published in English on 22.11.2017 at 19.18

Madam Speaker,

The last 18 months have shaken the European Union perhaps harder than ever before in its history. After Brexit, the existence and legitimacy of the whole Union were called into question.

The worst of this storm has, however, subsided. I dare to say that right now the European Union is stronger than before the UK’s referendum on EU membership. Brexit did not lead to the disintegration of the European Union; rather it drew the Union closer together. It forced us to look in the mirror and think what the Union has to offer to the Member States and their citizens and businesses.

The European Union is a community of values. The Union is built on strong values, peace, freedom, democracy, human rights and the rule of law. This is what we are committed to.

We have contributed to and committed to the vision of the Rome Declaration signed last spring. According to this vision, in the ten years to come we want a Union that is safe and secure, prosperous, competitive, sustainable and socially responsible, and with the will and capacity of playing a key role in the world and of shaping globalisation. We want a Union where citizens have new opportunities for cultural and social development and economic growth. We want a Union which remains open to those European countries that respect our values and are committed to promoting them.

We are also aware that the European Union is facing unprecedented challenges, both global and domestic: regional conflicts, terrorism, growing migratory pressures, protectionism and social and economic inequalities.

It is clear to Finland that we are stronger and more effective together than apart. It is better to work together and achieve more, than to work alone and achieve less — our place is in the front line where we can exert influence.

Adopting a middle-ground approach is no longer just Finland’s policy, but it is now a joint policy of the whole of Europe. We have paved the way for the EU to develop as a united and more effective community focusing on the essentials. We support multi-speed development, provided that certain specific requirements are met. At the moment, Finland is strongly involved in all forms of multi-speed development. We always make decisions on taking part in such development on a case-by-case basis, thinking first and foremost of the common interests of our country and the EU.

It is not in the interest of Europe or Finland that there would be a change so that decisions are made by a small group of Member States. At the latest European Council meeting, we quickly formed a group of eight countries to defend a united Europe. This was also adopted as a joint policy under European Council President Tusk.

Madam Speaker,

I would now like to address six areas that I consider key and in many ways critical to the success of the European Union in the years to come. In important issues such as these, the European Union must be able to work more closely together and to assume the role of a global leader confidently. Finland is actively involved in this work.

The first area covers security and defence cooperation in the European Union.

I met President Hollande in summer 2016. We issued a joint declaration on how EU defence policy should be further developed. This took place 18 months ago. The EU has made remarkably rapid progress in this sector on the basis of the declaration. Finland’s will and aim is for the decision-making process relating to defence regulations to be finalised within the agreed, fairly ambitious timeframe. We would like to point out that this sector is not an end in itself; rather it should bring concrete added value to solidarity amongst Member States in the field of security and it should support the further development of our national defence capabilities.

As for Permanent Structured Cooperation, we have said that we will be among the first to join in. Finland has played a key role in preparing this document with seven other Member States. On our initiative, the document now includes a clear reference to the mutual assistance clause of the Lisbon Treaty.

The Union must ensure security throughout Europe and respond to the challenges posed by globalisation and our immediate surroundings. The security situation in the Baltic Sea area is still intense. The situation in Ukraine continues as before, as does the sanction regime against Russia. At the same time, we consider it important to maintain bilateral dialogue with Russia. The war in Syria also continues and the Middle East is characterised by uncertainty. Turkey’s political direction still raises a lot of questions. The United States is committed to the security of Europe, but the message about the necessity of burden sharing has become clear. The European Union must be able to speak more clearly with one voice in international organisations.

These global changes emphasise the fact that the EU can be a credible actor in the future only if we take joint preparedness measures to maintain the safety and security of our citizens. We are now taking determined steps in the right direction. We must continue on this path.

Second, we need migration policy that creates stability.

Earlier this week, the Government outlined the objectives for EU migration policy. Finland’s objective is to reach a situation where, by European standards, migration is addressed with more attention paid to the resettlement of refugees and the quota refugee system, and in closer cooperation with the United Nations and the UN Refugee Agency, UNHCR. We must help people closer to where crises occur. The living conditions of refugee camps must also be improved so that it would be even possible for refugees to return directly to their homes.

The Government has specified six areas that help to manage migration flows better and that shift the focus to the resettlement of quota refugees. First of all, the root causes of migration will be addressed more effectively, the number of refugees to be resettled from refugee camps will be increased, the management of external borders will be reinforced, decisions and mechanisms on solidarity during crises and emergencies will be agreed beforehand, and the effectiveness of returns will be enhanced by making a common list of safe countries of origin as quickly as possible. In addition, the Schengen system will be improved. The Government will promote this model in its discussions with its other European colleagues.

Third, a prosperous European Union is based on a well-functioning Economic and Monetary Union (EMU).

The basis for European prosperity and stability is created through a responsible Economic and Monetary Union. The EMU is not ready yet, it still needs to be reformed. Finland has detected these problems, and the Government has proposed its own clear solutions to them. Since then, we have worked closely with the Netherlands.

The current Economic and Monetary Union has three main problems. First, there are large economic disparities between Member States. The solution here is based on the premise that Member States are responsible for their own structural changes and competitiveness. Finland is against the idea that economic disparities between Member States should be reduced through solutions that would increase Member States’ joint responsibility in the Economic and Monetary Union. We do not believe that a Euro-area budget or a Minister of Finance or a joint unemployment insurance scheme for the Euro area can be considered viable solutions. Instead, we are in favour of strengthening the position of the President of the Eurogroup and creating a separate budget article for the euro countries in the EU’s financial framework.

Second, the interdependencies between banks and Member States must be dismantled. The primary means for dismantling the interdependencies between banks and Member States is to complete the European Banking Union. In this respect the existing roadmap will be followed and a bail-in tool created for dealing with problem situations. The Government is ready to proceed towards a European deposit insurance scheme, but only if the risks of the Banking Union have been reduced. The Government also wants to promote a permanent backstop to the Single Resolution Fund and decrease the number of non-performing loans.

The third problem is the lack of market discipline. Market discipline is the best guardian of sound economic policy.  Achieving a credible solution based on market discipline means that the risks of the economic policy pursued must be integrated into the pricing of sovereign debt. This means that sovereign debt restructuring must be possible in accordance with and in the spirit of the EU Treaty. The European Stability Mechanism can also be developed through crisis response into a European Monetary Fund.

Fourth, the European Union needs an ambitious climate policy.

Europe must take the lead in climate policy. It is our only option. I voiced this claim, in my capacity as Prime Minister, right after the United States confirmed its withdrawal from the Paris Agreement. I also discussed this with French President Macron when we met in September. He agreed with me. The European Union must have ambitious targets also for renewable energy. The Union must phase out fossil fuels and find sustainable ways to deploy renewable energy sources.

The EU cannot have dual objectives. We cannot set ever-greater climate objectives, if we are, at the same time, making it more difficult to use our renewable energy sources. Even in the future, Finland must be able to fully harness our forest resources within the limits of sustainability.

Fifth, the European Union must promote a trade policy defending open and free trade.

Last summer we published a strong appeal for free trade together with the Prime Ministers of Denmark, Sweden and the Netherlands. The only way for Europe to do well and prosper is to continue to be an open union. We cannot turn inwards. This also applies to trade policy. There is no room for protectionism in the European Union. We must bring the free trade negotiations to a successful conclusion and seek new trading partners. The EU must take the lead if the United States wants to give up its role as the champion of free trade, as it seems at the moment. Finland also calls for a bigger and better internal market and more actions to combat tax evasion.

Sixth, the social dimension of the European Union must be further developed.

The European Union needs a Europe with a strong social dimension — a Europe where all have access to growth and prosperity, where we have a fair single market, where together we seek solutions to the massive problem of youth unemployment and where we work together for better equality in working life.  We must determine which social issues could be taken into account in EU decision-making on a broader scale. European policy also means that we take care of each other regardless of national boundaries. It does not mean a common social security system; instead it means managing our finances so that there is room for work, high-quality education and entrepreneurship.

Madam Speaker,

The Government works actively and takes initiatives in EU policy. We are in the front line of exerting influence.

The Government’s EU policy is based on national positions adopted well before decisions are made in the EU. It allows Finland to have influence at all levels of EU decision-making and at the same time take account of our national interests and special circumstances.

Finland has also been active in promoting digitalisation and artificial intelligence at EU level. On Finland’s initiative, the European Council invited the Commission to draw up a European roadmap for artificial intelligence early next year.

As I see it, having lively debate about EU affairs is an important part of our society. I hope that this debate will be based on strong facts. The Government plays a leading role in this. I am planning to visit Finnish universities to discuss the future of the EU. Deliberations on the future of the EU are firmly on the agenda of the Heads of State or Government. In this way I hope to encourage everyone to get involved and have an impact on the future of our Europe.

Juha Sipilä

Prime Minister of Finland

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Updated 11/24/2017


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