Brussels, 17 Jul 2006
COMMUNICATION FROM THE COMMISSION ACTIONS PROGRAMME FOR THE PROMOTION OF RESEARCH AND ANALYSIS OF ISSUES RELATED TO THE EUROPEAN ECONOMIC AND MONETARY UNION
The Ecofin Council report to the European Council on 11 and 12 December 1999 in Helsinki on "Economic policy co-ordination" (13123/1/99 Rev 1) called for an effective monitoring of economic policies in stage three of the Economic and Monetary Union (EMU). For this purpose, the Council considered the improved understanding of economic developments and economic policy issues related to EMU an essential prerequisite.
According to the Treaty, the European Commission has an important role in informing the EU authorities, the Member States and the various economic agents on both the economic situation and prospects and on the impact of economic policy measures on the functioning of EMU. To give informed advice on economic developments and economic policy issues in EMU a thorough economic analysis and research is paramount. While a substantial part of this analysis and research is carried out inside the Commission and its services, a great variety of relevant contributions is produced by other institutions such as international organisations and the research community at large. The main objective of the actions programme for the promotion of research and analysis of issues related to EMU is to create a platform through which the results of this external research can be channelled more effectively into the policy debate within Community institutions.
2. THE NEED FOR A COMPREHENSIVE AND INTEGRATED APPROACH TO PROMOTE EMU RELATED RESEARCH AND ANALYSIS
The creation of EMU requires a strengthening of the analytical basis for economic policy decisions. Moreover, the awareness of the policy requirements of EMU in the Member States needs to be improved so as to raise the understanding for greater economic policy co-ordination.
To benefit to the greatest extent from the output of external analysis and research of EMU related issues, a comprehensive and integrated approach governing the relations, contacts and communications with the institutions producing such analysis is required. On the one hand, this is necessary to channel the results of this research in an appropriate way into the various circuits dealing with economic policy matters within the European institutions. On the other, this allows for feedback from the European Commission and other EU fora that can guide and direct this research into areas, which are most important and fruitful for the work of EU policy makers.
The European Commission has responded to the need for such a comprehensive and integrated approach by establishing a broad-based actions programme implemented by Directorate General for Economic and Financial Affairs1. While some of these actions were instigated at the explicit request from Member States, others were created on the initiative of the European Commission. Such actions include, for instance, the establishment of an external expert group on analysis and forecasting macro-economic developments in the euro area (the "European Forecasting Network"); the organisation of research conferences, workshops and seminars both on a regular and on an ad hoc basis; the creation of a visiting fellows programme within the Commission services; or the setting-up of a study programme in the area of EMU related research with the purpose of soliciting specifically focused contributions from external researchers.
3. IMPLEMENTATION OF THE PROGRAMME
A detailed description of the various components making up the programme and the supporting activities are listed below
(a) The European Forecasting Network
The creation of the European Forecasting Network (EFN) was proposed in 2001 by a Franco-German initiative . This initiative aimed at improving the analysis of euro- area economic conditions and policy options through the production of regular independent assessments of the economic outlook and policy challenges by a network of leading EU research institutes.
The proposal received broad support by the Economic and Financial Committee and the Eurogroup and the Commission was invited to initiate the creation of such a network. The Commission responded positively to this request and selected a consortium of eight research institutes based in six different Member States for the period 2002-2004.
This research network produced its first report in Spring 2002. The network produced five further reports on a semi-annual frequency, the last one in Autumn 2004. In addition to a regular conjunctural analysis and a macro-economic forecast for the euro area, the various reports covered a wide variety of EMU relevant themes. Topics included the development of labour cost and productivity in the euro area, macro-economic shock absorption in the euro area, cyclical convergence in EMU or the economic effects of enlargement on EMU.
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