6th International ABC-Fundación Euroamérica-BBVA Conference
Francisco González: “We will exit the crisis through greater fiscal, financial and economic integration in Europe”
- “The efforts made by Spain and other countries must be matched with shared European-backed mechanisms”
- “The Spanish government is working intensely on the right direction since, in just three months, it has implemented a major fiscal adjustment and approved a financial system reform which opens the door to restructuring, a very ambitious and in-depth labor reform, and a plan for paying suppliers of the Public Administrations”
- “Spain has many strengths and enormous potential to turn the current situation around. If we continue along this path, we will get through this”
Francisco González, Chairman and CEO of BBVA, stated that the crisis in Europe has not yet been resolved but that “in the last few months, there have been some major advances”. At the opening ceremony of the 6th International ABC-Fundación Euroamérica BBVA Conference at the BBVA Campus, he stated that “Spain has implemented adjustments and reforms that must be understood as the start of a modernization process that has been a long time coming”.
Francisco González stated that the restructuring of Greek debt has been a step forward in finding a credible and sustainable long-term solution. According to him, “I’m sure that the mistakes made in Greece will not be repeated in other European countries. Greece is the exception, not the rule”.
Secondly, the BBVA Chairman and CEO stated that another advance was the “European Central Bank’s liquidity policy, which has contributed to ensuring the liquidity of the European financial system, one of the main factors for the recovery”.
Spain has enormous potential
The BBVA Chairman and CEO considers that “Spain is doing its part”. In his opinion, “the Spanish government is working intensely on the right direction. In just three months, it has implemented a major fiscal adjustment and approved a Royal Decree-Law to reform the financial system, opening the door to restructuring it, as well as a very ambitious in-depth labor reform, which will benefit all those living in Spain”.
The BBVA Chairman and CEO also stated that the Spanish government has launched a financial plan to pay the suppliers of the Public Administrations, which will provide a major liquidity boost for the Spanish production system as a whole, especially for small and medium enterprises and self-employed workers.
“This must be understood as the start of the modernization process of the Spanish economy which has been a long time coming. I’m sure that this is the Spanish government’s conviction, since it has shown signs of making the decisions that must be made and continuing the reform process”.
Francisco González stated that “there is clearly more to be done since we need to restore fiscal discipline in all the Public Administrations while implementing the necessary reforms to boost economic recovery and job creation. We need to build a new and more competitive economic model that is more leveraged towards technology and talent, with the capacity to innovate.”
According to the BBVA Chairman and CEO, an ambitious modernization program is required in order to carry that out. Francisco González highlighted the importance of providing a good explanation of that model and program to the Spanish and European public opinion and capital markets since “they are our creditors and will finance us”.
“We will need to persevere, especially when everything starts to improve. Because the situation will improve. Spain has many strengths and enormous potential to turn the situation around. If we continue along this path, we will get through this”, he explained.
Francisco González also stated that the efforts made by Spain and other countries must be matched with shared European-backed mechanisms. That is why “Europe must also do its part”. “We will exit the crisis through Europe, i.e. with greater fiscal, financial and economic integration. In the short term, advancing towards that solution requires stronger signs from the major European countries regarding their commitment to the European integration process. Those signs must entail specific decisions to support countries which, like Spain, have adhered to the rules of the Stability and Growth Pact, and are implementing ambitious adjustment and reform programs”.
He also believes that it is necessary to advance in the design and implementation of a reciprocal fiscal commitment, which can have different forms, such as the issue of Eurobonds. The BBVA Chairman also stated that “a greater Europe means a more coherent and standard European communication policy that highlights the efforts made by its member states and prevents indiscreet comments”.
According to Francisco González, Europe must establish a set of incentives to support the member states with the largest commitment and progress towards implementing structural reforms. “Solidarity among its citizens is one of the essential principles in building a stable future for the European Union. We face an enormous challenge as well as the opportunity to make Spain more competitive and prosperous within a united and relevant Europe in the new world order”, highlighted Francisco González.
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