Enda Kenny (Mayo, Fine Gael) | Oireachtas source

I am pleased to have this opportunity to inform the House about discussions at the December European Council and to look ahead to the informal meeting of Heads of State and Government on 12 February.

I note that the first Latvian Presidency has recently begun. This will also be the first full Presidency since the changes in the Union's institutions in the autumn, and it is shaping up to be a very busy one. Latvia's Presidency priorities are grouped under three main themes, namely, a competitive Europe, a digital Europe and an engaged Europe. The underlying and continued focus on stimulating growth and job creation is extremely welcome and reflects the expectations and priorities of Europe's citizens. The Latvian Presidency has also pledged to drive forward urgent work on counter-terrorism, and I will return to this later in my statement. As we in Ireland well know, an EU Presidency can be a daunting prospect for a small country, but is also extremely rewarding. I wish Latvia well and assure it of Ireland's full support in delivering on our common priorities.

Let me reflect on the last meeting of the European Council, which took place in December. This meeting sought to agree the tools for addressing one of the key challenges facing the Union today, which is the low investment levels which continue to stymie growth. We also returned to consider the evolving situation in Ukraine. In addition, our conclusions touched on the fight against tax avoidance and aggressive tax planning, as well as the functioning of economic and monetary union. The December meeting of the European Council was the first to be chaired by the new President of the European Council, Donald Tusk. Deputies will have seen that the conclusions are focused and succinct, avoiding repetition of statements already made and positions already agreed in Council. I know that President Tusk intends to continue this approach, to minimise time spent on drafting and maximise the time Heads of State and Government can spend on strategic discussions.

The focus of our December meeting was on efforts to boost investment, based on a comprehensive plan brought forward by Commission President Juncker, who has personally attached a very high priority to this issue. Boosting investment in the real economy is critical for growth, and for bringing down the persistently high levels of unemployment which continue to plague so many countries in the Union. In my contribution to a panel discussion at the World Economic Forum in Davos last week, I spoke of the critical importance of European governments and institutions working closely together. The investment agenda is one practical area where close co-operation between the Commission, the European Investment Bank, EIB, and member state governments can make a real and positive difference, not least given the inter-dependence of member state economies. The European Council gave its strong political backing to President Juncker's investment plan. This does not mean that every element was agreed; this was not the intention. However, there was consensus with regard to the broad outline of the new approach.

The European Council set the ambitious goal of having the new European fund for strategic investments, EFSI, up and running by the middle of this year. The aim is to mobilise €315 billion in new investments between 2015 and 2017. The European Council clarified that the EFSI will complement and be additional to ongoing EU programmes and traditional EIB activities. This was an important point, and something which Ireland raised ahead of the meeting.

I do not pretend, and neither does President Juncker, that this investment plan is a magic solution which can single-handedly solve the problems of stagnating growth and high unemployment in Europe. However, it is one important aspect of a broader policy mix, which also includes structural reforms, prudent fiscal policy and monetary policy. With regard to the latter, I am very encouraged by the decision of the ECB last week to expand its balance sheet through large-scale asset purchases, including the purchase of sovereign debt in the secondary market, otherwise referred to as quantitative easing. This should create upward pressure on inflation and lead to improved financing conditions for households and firms, thus supporting investment and job creation. I hope that the move will help restore much-need confidence in the euro area economy.

Since December, work has been moving ahead quickly on the European fund for strategic investments, EFSI. A legislative proposal to facilitate the establishment of the fund was published by the Commission on 13 January. This is being considered in detail by experts in Brussels, including from our Department of Finance. The intention is to reach agreement at the ECOFIN meeting in March in order that negotiations can open immediately with the European Parliament. I have asked my Department to work with other relevant Departments towards a coherent and well-co-ordinated approach to the new investment plan, including early shortlisting of options. This has begun and will continue over the coming weeks, closely aligned with deliberations in Brussels and preparations for the March meeting of ECOFIN.

While we should be careful to avoid unrealistic expectations, there may be opportunities to develop synergies between the new investment plan and the Ireland Strategic Investment Fund established by the Government last year. I have also asked my officials to ensure that careful consideration is given to any potential in the area of infrastructure investments by State bodies, as well as to the implications for Ireland of a refreshed Commission guidance on making best use of existing flexibility in the Stability and Growth Pact. I will be happy to keep the House informed in the period ahead.

While much of the media attention in relation to the investment agenda has been focused on the EFSI, the European Council also called for progress in other important areas which can provide a supportive environment for economic growth through investment and trade. For example, we called for speeding up the adoption of Union legislation in the Single Market area and the enhancement of efforts to remove barriers.

The European Council also called on the Commission to present a comprehensive energy union proposal well in advance of the March 2015 European Council. The crisis in Ukraine and the challenge of climate change have underlined the need to reduce European reliance on imported energy and to secure the energy future of the EU. Increased energy efficiency is also a key component of the Union's strategy.

The European Council called for the further strengthening of the multilateral trading system and the conclusion of bilateral trade agreements with key partners. Needless to say, concentration was focused on the transatlantic trade and investment partnership, TTIP, agreement. We encouraged the Commission and US negotiators to make every effort to conclude an ambitious, comprehensive and mutually beneficial agreement by the end of this year. While this deadline is looking increasingly challenging given the many complicated issues under discussion, TTIP remains a priority for the new Commission and the Latvian Presidency. The Irish Presidency also played an important role in the process when it helped to secure the Commission mandate to open negotiations. The Government will continue to support efforts to conclude the talks in the shortest time. The United States is one of our most important trading partners and improved access to the US market will benefit Irish companies and, in particular, small and medium enterprises, SMEs. We owe it to ourselves to work towards this ambitious outcome rather than settling for a lesser agreement which fails to realise the full potential of our trading partnership with the US.

In regard to taxation, conclusions were adopted which stressed the need to advance efforts in the fight against tax avoidance and aggressive tax planning. As Deputies will be aware, Ireland has engaged actively with these discussions at the OECD and we will participate constructively in EU efforts while maintaining the firm position that matters of direct taxation remain a member state competence. There is a commitment to return to taxation issues at the June European Council, and I will keep Deputies fully briefed in advance of and following that meeting.

Moving on to external relations, the Minister of State, Deputy Murphy, will update members shortly on our discussions and decisions in regard to Ukraine. Unfortunately, the situation on the ground has deteriorated. EU Heads of State and Government today issued a joint statement condemning the killing of civilians during the indiscriminate shelling of the city of Mariupol at the weekend, and noting evidence of continued and growing support given to the separatists by Russia. We have asked the Foreign Affairs Council, which meets on Thursday, to assess the situation and to consider any appropriate action, in particular on further restrictive measures. The Minister, Deputy Flanagan, will participate actively in these discussions.

I also raised at the European Council the horrendous attack which took place on the school in Peshawar, Pakistan on 16 December. More than 140 people lost their lives in this barbaric attack, the vast majority of them children. The High Representative, Ms Mogherini, released a statement on behalf of the EU which expressed our collective shock and confirmed the EU's commitment to tackling the threat posed by terrorism and our readiness to further assist the Pakistani Government.

Since the last meeting of the European Council, we have also witnessed tragic events here on European soil. On the Sunday after the attacks in Paris, I had the opportunity to convey directly to President Hollande Ireland's sympathy with and support for France and her people at this very difficult time. The attacks were a very stark reminder of the very real threats to our common European values and way of life, but they also highlighted the enormous value of unity and solidarity among the member states in addressing these common challenges. We must continue to work closely together to protect and preserve our fundamental values and freedoms from the scourge of terrorism.

On 12 February, Heads of State and Government will gather for an informal meeting in Brussels. The overriding focus of that meeting will be to consider how we can work together to counter the threat posed by terrorism and extremism. Our discussions will be informed by work already taken forward through the Foreign Affairs Council on 19 January and by an informal meeting of the Justice and Home Affairs Council later this week.

As Deputies will be aware, there is considerable concern across Europe and elsewhere at the phenomenon of individuals travelling to conflict areas in the Middle East and the consequential threat posed to national security. The recent events in Paris and also in Brussels are just the latest and most serious manifestations of the threat posed by foreign fighters. Even countries with highly sophisticated intelligence resources are finding it difficult to predict and counter attacks. At the Foreign Affairs Council, Ministers were united in their resolve that the 28 members of the Union would stand together in the face of the threat posed by terrorism and extremism. The Council considered a number of practical steps to improve the EU's counter-terrorism capacity, mainly aimed at improving the coherence and effectiveness of our efforts. It was agreed, for example, that there will be heightened co-operation with Europe's near neighbours, including on policing. Consideration was given to how we can strengthen communications with the Arab world, which is vital in addressing the root causes of extremism.

Issues to be considered at the informal Justice and Home Affairs Council later this week are likely to include the need to strengthen the borders of the EU; the adoption of an EU passenger name record system, which continues to be held up in the European Parliament; improved police and judicial co-operation; measures to improve control of firearms; and measures for countering extremism and radicalisation on the Internet. Let me emphasise that Ireland, like all other EU member states, favours a strengthened EU role in this area but one that is simultaneously fully respectful of human rights principles. We must avoid, in our determination to stand up to and defeat the scourge of terrorism, the pitfall of undermining the very rights and principles that are the cornerstones of our democratic societies.

In addition to considering counter-terrorism measures, the informal meeting will provide an opportunity for a first discussion since the appointment of President Juncker and President Tusk on the strengthened co-ordination of economic policies to ensure a smoother functioning of economic and monetary union, EMU, and the avoidance of future crises. Together with Mario Draghi as President of the European Central Bank and Jeroen Dijsselbloem as President of the Eurogroup, they will present a report to the June European Council.

Although the situation in Greece is not formally on the agenda, it will be on everyone's mind. It will also be a first opportunity to engage with the new Prime Minister of Greece, Alexis Tsipras. I wish him well in the huge challenges he faces. There are undoubtedly difficult choices ahead for the new Greek Government and it is important for it to choose the path of constructive engagement. I hope that any negotiations will result in a politically and economically sustainable basis for Greek recovery within the framework of euro area rules and commitments.

I also wish to inform the House that next week I plan to travel to Brussels for bilateral meetings with President Tusk and President Juncker. This will be an important opportunity to renew what are already very close personal relationships with the Union's new leaders and to convey Ireland's views on the issues of priority to us and to the Union. I will be happy to report back to the House on both of those meetings.

I thank Deputies for their attention and look forward to hearing views from the floor.

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