capacity  Legitimacy: Appointment process and international role  Capacity: Treasury administration and advisory councils  Accountability: Stronger democratic control over euro area affairs  First, we need a legitimacy-enhancing appointment process. The Finance Minister could thus be appointed for a five-year period by the European Council acting by qualified majority on a proposal from the president of the EU Commission. The new appointment would be subject to the formal approval of the European Parliament, and the Finance Minister would be member of the Commission, as well as chair of the Eurogroup. Second, the euro area Finance Minister would need to be backed by a genuine Treasury administration. Such a civil service would also benefit from the public advice of two independent bodies, the European Fiscal Board and the Competitiveness Council. Last, if we succeed in implementing further integration, we will need stronger democratic control over euro area affairs. To this end, we will need to consider a euro area format of the European Parliament. Relationships between euro area MPs and national parliaments will also need to be enhanced. As I said, not only do we need to better coordinate public policies, but we also have to foster private risk-sharing throughout the Eurozone. To recall Wolfgang Schaüble, European leaders need to show “that balanced budgets, growth and investment are not mutually exclusive, but rather go hand-in-hand”5. 5  Wolfgang Schaüble, “Managing Europe – What is Germany’s responsibility?”, speech at the LSE, March 3 2016. BIS central bankers’ speeches  7  III.
François Villeroy de Galhau: Europe at a crossroads – how to improve economic governance and growth performance of the Eurozone? Presentation by Mr François Villeroy de Galhau, Governor of the Bank of France, at the German Institute for Economic Research – DIW Berlin, Berlin, 8 June 2016. *  *  *  I am delighted by the opportunity, kindly offered by DIW, to share some remarks on Europe here in Berlin. As you may know, I have strong ties with Germany. In particular, I completely share the German culture about the importance of responsibility and long-term vision. At this juncture we probably all agree on two things – and my focus today will be that these two things are closely intertwined: •  Monetary policy cannot be the only game in town. •  Although Monetary Union is a success, Economic Union remains to be built. I want to pay tribute to Helmut Schmidt, who said in October 2011: “There was a failure to set the economic rules of the game for the currency union. A powerful authority with responsibility for fiscal and economic policy was not set up.” 1 I will first argue that monetary policy has been doing its fair share (I). I will then discuss the need for a “full coordination” of national economic policies in the Euro area, and discuss what concrete progress can be made (II). Finally, turning to private risk-sharing in the Eurozone, I will focus on the importance of building an efficient Financing and Investment Union (III).