President of the Government: Good morning and thank you. The European Council has launched very clear messages on key issues such as the growth pact, the sustainability of sovereign debt and greater economic, fiscal and financial integration. Each of the Member States has committed itself to making progress along the path of fiscal consolidation and promoting the structural reforms needed to boost the competitiveness of our economies and tackle internal imbalances.
You have heard me say very often that these five elements - fiscal consolidation, reforms in each country's economy, reforms in Europe, sustainability of the debt and greater fiscal and financial integration in Europe - are all conditions for tackling the financial crisis, for growing and creating jobs.
So I believe that this European Council meeting has marked a correct path for us to face the crisis and has shown a clear route; but I also say that we have to continue working and that we still have a long way to go.
So I insist that the Government of Spain is committed to making progress in fiscal consolidation and cleaning up our public accounts; and that we are also going to continue to undertake the reforms needed to modernise our economy and with this foundation, to grow and create jobs. This is a commitment to our partners, but above all it is a profound conviction about what has to be done to improve the current situation.
I would also like to highlight the response that the European Commission has given to matters that are of interest to us all. As you know, we were expected to provide a response to three fundamentals: growth and employment; stability of the financial markets and a medium-term project for greater integration. I believe that the response has been clear and emphatic.
Our main common objective was to preserve the euro and show a firm commitment to the irreversibility of the single currency. I believe that this Council meeting has launched a very clear, unmistakable signal in this direction. Today the European project is stronger and more credible than yesterday.
Finally, allow me to make an express recognition of the responsibility and far-sightedness of my colleagues in the European Union and Eurozone. I would in particular like to thank the close collaboration we have had between the leaders of the main economies of the Eurozone throughout this weekend.
That is what I have to say to you about what has taken place here, and I am now available for questions.
Q: President of the Government, I would like to ask you about the agreements reached thanks to the pressure from Spain and Italy; the agreements about the stability of our debt. I would like to know if you could explain these agreements and what conditions they involve, if you would be so kind.
President of the Government: You cannot achieve any agreement or reach any agreement through pressure on the part of anyone. Here everyone puts on the table what appears to them a good idea and appropriate; based on the fact that there are different opinions and an agreement has to be found. Finding an agreement between seventeen is not easy; when it has to be twenty-seven, it is even more difficult.
This is an exercise in which we all have to work in the same direction, but we have to set out the objectives, and as is reasonable, human and sensible, because our situations are different, we do not have the same opinions about everything. That is absolutely human.
But there has been no pressure or anything of the kind; there has been a suggestion and everyone agrees, above all, about defending the euro, which I believe is the great winner at this European Council meeting, the euro and the European project.
Based on this, a number of decisions have been taken. The truth is that they are very technical questions. One of them, which is important, is that the debt of the instrument used to recapitalise the Spanish banks does not have priority over the rest of the debt; that is important. There has also been very important progress towards direct recapitalisation of the banks, and I believe that there is a clear message on action in the secondary markets.
That is basically what there is. It will be made specific in the ECOFIN meeting on 9 July, but I am satisfied, above all, that it is a clear message in defence of the euro.
Q: Mr President of the Government, I would like to ask you for some more details on these statements that the President of the ECB, Mario Draghi, has made, that in fact aid will be given directly to the banks, with strict conditions. I would like to know what Mr Draghi was referring to with these words.
Could you anticipate more information about how the sovereign debt of Italy and Spain will be assisted? Has the instrument been decided on? What will it consist of?
President of the Government: The statements by the president of the Central Bank were made by him in the exercise of his duties. He is an independent person, because the institution is independent and I do not have anything to comment on in this matter.
The measures we have taken are the measures I referred to earlier. I believe that what we have here is, above all, a very clear message in favour of the euro. That cheers me and it cheers all of us who believe in this European project as well.
Q: Mr President of the Government, I would like to know if with the flexibility that has now been promised when it comes to asking the Bailout Fund to intervene in the Spanish government debt, the idea is to make a request of this kind to alleviate the problems of the Spanish debt.
President of the Government: Actually, no. The truth is that we are not considering anything of this kind.
Q: Mr President of the Government, regarding conditionality. The Statement or the Conclusions of the Summit talk about "conditionality… economy-wide"; that is the literal phrase taken from the text of the conclusions. The Government has opposed macroeconomic conditionality of any kind and the PSOE party considers it a red line. I would like to know what kind of conditionality we are talking about when there is talk of the whole economy.
Second, I would like to ask about time-frames. The Declaration talks about considering a decision in December once there is a European banking supervisor for direct recapitalisation. When exactly will this direct recapitalisation arrive?
President of the Government: On this question, I would tell you that we are negotiating the memorandum and we see, because of the system currently in force, that it is the EFSF, that there is no other type of macroeconomic conditionality. Then we move to the EMS, the second mechanism, and then when the supervisor is approved, to direct banking recapitalisation. So there is no conditionality, because that is already what was agreed at the Eurogroup when it gave the green light to the request made by Spain.
As to the second question, what has been said is what has been said: 2012.
Q: Mr President of the Government: two questions. I would like to know what would have occurred if yesterday Spain had not forced this negotiation in partnership with Italy. What would have happened? What scenario would we have found if these negotiations could not have taken place?
Then, to raise a subject linked to what you said, you have said that the Government's reform programme will go ahead. I would like to know if we are going to have a new adjustment plan before the summer holidays.
President of the Government: When we have taken a decision, don't worry we will tell you; I don't know if it will be an exclusive, because I am not thinking, above all, of announcing it here. But you can be sure that you will know. That is with respect to your second question.
What would have happened? I don't know. But I insist, I believe that it is a triumph for the euro; I believe that we had a conversation, because I would not call it an argument, that was very enriching, and in the end all of us who are in the euro project agree on what is fundamental and essential; and when you agree about the fundamental and the essential, the other things become accessories.
All of us who are in the euro, in the end wanted voluntarily to have this currency. We want it to continue, because that is where we have decided to be; we want there to be more integration and we want fiscal integration, banking integration. We have been talking about all of this, and so it is important.
The most important message from this Summit, far more so than the details, is the reaffirmation of this great political project that is the euro, where there are many countries that represent much in terms of global GDP, and we have the common goal for all of us of generating economic growth and creating ever more jobs.
Q: Mr President of the Government, I would like to know if after this message, with which you are satisfied, do you believe that we can think that the worst of the market onslaught on the debt has passed, or if, as you say, we have to continue to wait for the next Summits for the risk premium to really relax more, though today it was reacting well?
And second, I would like to insist a little on the conditions, not the macroeconomic ones, but what will the Spanish banks have to do to receive this direct recapitalisation?
President of the Government: So far this is being negotiated in the memorandum by the EFSF procedure, so I cannot make any announcement until the negotiations with the financial institutions have ended.
With respect to the other point, to be perfectly frank, what I am worried about now is trying to do things well. When we take decisions we decide "you cannot spend more than you have and you cannot increase the deficit or the debt, among other reasons because no one will give you finance"… So you can say "I'll increase it", but that is absolutely irrelevant because you can decide to spend a thousand, and if you do not have it, you run the serious risk that no one will give it to you.
When we take these decisions, when we carry out structural reforms, when we commit ourselves to the euro and when we commit ourselves to banking union, there is only one goal; and that is to try to ensure that things go better in Spain for Spanish people, and, if you will allow me, also to Europeans as a whole, in each country. So that is what I am going to worry about.
There will be better times and worse times, as always happens in any aspect of life. The calm that I feel is because I know what we want to do; I know it. In other words, the Government knows perfectly well what it has to do and what its objectives are. Based on that, what happens on some occasions may be better and on other occasions it may be worse, but the key is to maintain a consistent line, to say "that is the direction we have to go in"; and that is what gives me the peace of mind and serenity to fact this situation, which is not an easy one.
Q: Mr President of the Government, I know that you don't like giving private details…
President of the Government: If you know that shouldn't you act accordingly?
Q: How was this Spanish negotiation managed? Was this approach that the two of you put forward yesterday at the Council agreed beforehand with Mario Monti, or was it something that emerged at the last minute? Could you give us any small details about this question?
Then, with respect to the Commission's recommendations, I would like to ask whether we can expect a rise in VAT before the summer in Spain.
Finally, I would like to know if you are going to go to the final of the European Cup.
President of the Government: In terms of the details, what is most important, most relevant, and I think that you and I should always deal with what is important and relevant, is the agreement. What is important is that there has been an agreement that, in my opinion, strengthens the position of the euro. That is where we have reached a consensus; and that is also reasonable, because that is why we entered the euro. That is what is important, everything else is minor. I insist, there has been an agreement, because on the substantial questions we all think the same.
With respect to the second question, if there is anything, as I said before, I will let you know in good time, and if there is nothing, I will not let you know in good time.
With regard to the final in the Ukraine, I believe that it is my obligation as President of the Government to be with a national team that has been enormously successful, that is playing very well and that is a source of pride for many Spanish people. I had the good fortune to see them off in Las Rozas, and then I was there at the first match in Poland. I believe it is my obligation and so I will be there. We will see under what conditions we do so, but obviously we will talk it over with our European Union partners. But in theory, I will be there.
That's it. Ladies and gentlemen, a very good afternoon to you.