Achieving an optimum, sustainable monetary union over time

Monetary Union: Single Resolution MechanismMonetary Union: Single Resolution Mechanism

It’s not just about implementing monetary union but also ensuring that it is sustainable over time.

Supervision and a single resolution mechanism for the banks, along with a common deposit guarantee, are undoubtedly essential. In the medium-term, however, greater fiscal convergence, with a more extensive mutualisation of risk in the region, are just as important. Apart from the free movement of labour and capital. Without forgetting the convergence of economic cycles between countries.

Just economic cycles? The birth of the euro meant, of course, that monetary convergence would create real convergence. The deficiences in the design of the euro were reflected in the crisis. You know the rest.

In 2010, the European Council established the strategy for 2020, focused on five major objectives: employment, research and development, climate change and energy, education and the reduction of poverty. Objectives which should be met within 10 years. There are now three years left to do this.

Eurostat periodically monitors as many as nine indicators related to these final objectives. The worst progress up to now has been made in poverty, investment and employment. In some cases there is a huge gap compared with the target, like fighting against social exclusion. Energy saving, education and awareness about climate change have performed better.

The quantification and objectives can be seen in the following table:


There is a lot of work to be done. Structural reforms which facilitate an increase in potential growth. And all of this framed by an inclusive growth model.

Part of this model involves greater financial inclusion. The Spanish banks have done some good work in this sense. Technology, the progress in the digitalisation of financial services, will undoubtedly be a key factor in the continued advance in financial inclusion, with transparency and responsability, which will allow for greater social inclusion.