Eurogroup statement - Thematic discussions on growth and jobs

April 25 2016 - The Eurogroup is fully committed to supporting economic growth and jobs and holds regular thematic discussions to explore and define common policy ambitions to this end. The Council recommendation on the economic policy of the euro area in the context of the European Semester clearly indicates the areas where reform is the most pressing. “Since the beginning of the year, we have discussed twice the recommendation to improve national insolvency frameworks, an area explicitly addressed in the Council recommendation to the euro area for 2015 and 2016 as well as in the individual 2015 Country-Specific Recommendations for several euro area Member States” stated Eurogroup. Private sector debt remains high in a number of euro area countries and contributes to holding back the recovery in investment and consumption. In particular, the high level of non-performing loans in banks' balance sheets constrains the supply of credit, thereby hampering the monetary transmission mechanism, and reduces the efficiency of capital allocation. Having effective and efficient insolvency frameworks in place is key to ensuring a smooth deleveraging process, thereby facilitating adjustment processes within the euro area, while improving the business environment and supporting private investment. It would also support deeper financial integration within the euro area, which will be beneficial for the strengthening of the Banking Union, fostering growth and resilience to asymmetric shocks. It would also contribute to building the Capital Markets Union, recognising that this work takes place in the EU-28 setting. While a number of euro area Member States have carried out significant reforms in the recent past, the Eurogroup is conscious that more efforts are needed: “Today we agreed on a number of core common principles that could serve as guidance for improving the efficiency of national regimes in dealing with insolvency. While we aim to converge to a high level of efficiency and transparency of national insolvency rules and practices within the euro area, we recognise that when applying these common principles, country-specific circumstances - in particular national legal frameworks - need to be taken into account”.