The single currency needs to interact with a single fiscal policy. To be effective, a fiscal union requires the introduction of common debt instruments and, at the same time, decisions on the treatment of pre-existing national debt with a view to a single euro-area debt. A number of practical proposals to this effect have been put forward, some of them quite recently.
In my concluding remarks on this occasion four years ago, amidst very severe sovereign debt tensions, I emphasized the need to increase our common resources, including by instituting a fund to which a portion of sovereign debts could be assigned; these would eventually be redeemed, according to clearly defined rules and without transferring funds between countries, thereby giving rise to a form of fiscal union not lacking cogent rules and powers of control and intervention.