A3-0319/94

Resolution on the objectives and instruments of a monetary policy

The European Parliament,

-having regard to Articles 105 and 109f(3), first indent, of the EC Treaty,

-having regard to Article 8 of the Statutes of the European Monetary Institute,

-having regard to the report of the Committee on Economic and Monetary Affairs and Industrial Policy (A3-0319/94),

A.whereas the principal and most important task of the European Monetary Institute (EMI) is to prepare the common monetary policy for the third stage of Economic and Monetary Union provided for in Article 109f of the Treaty on European Union and Article 4.2 of the statutes of the EMI; and whereas, by 31 December 1996 at the latest, the EMI shall specify 'the regulatory, organizational and logistical framework necessary for the ESCB to perform its tasks in the third stage',

B.whereas the European Parliament, as the representative of the people of Europe, is in a position to contribute to the debate on the definition of a monetary policy, with due regard for Article 8 of the statutes of the EMI, which imposes on the Community institutions the obligation not to seek to influence the EMI council in the exercise of its activities,

C.whereas, according to Article 105 of the Treaty on European Union, the primary objective of the European System of Central Banks (ESCB) and the European Central Bank (ECB) is to maintain price stability,

D.whereas, pursuant to Article 109l of the Treaty on European Union, the Council, acting with the unanimity of the Member States without a derogation, shall on the starting date of the third stage adopt the conversion rates at which their currencies shall be irrevocably fixed and at which irrevocably fixed rate the ECU shall be substituted for these currencies, and whereas the Council shall also, pursuant to Article 109 of the same Treaty, adopt the central rates of the ECU within the exchange-rate system,

E.whereas the single monetary policy must necessarily be implemented from the beginning of the third stage of EMU and whereas the ECB must gain genuine credibility in the eyes of the financial markets and of public opinion,

F.whereas decisions on the definition of monetary policy must be reached in accordance with the criteria of good economic management,

1.Calls on the European Monetary Institute (EMI) to give priority to one of its most important tasks, that of preparing, in accordance with Article 109f(3) of the Treaty on European Union, 'the instruments and the procedures necessary for carrying out a single monetary policy in the third stage';

2.Recalls that during the third stage of EMU the ECB must conduct its monetary policy with complete transparency and report on its activities to the Community institutions, as must the EMI during the second stage;

3.Takes the view that for the ECB to determine and publicly announce one or more monetary objectives ('intermediate objectives') would not only be in keeping with these principles of transparency and accountability, but is also essential in order to attain the objective of price stability ('the final objective') while furthering growth and employment;

4.Takes the view that in order to achieve the 'final objective', there must be one or more 'intermediate objectives', which the ECB and the EMI would have the means of monitoring, in the interests of furthering the essential credibility of the European monetary policy;

5.Points out that most of the European Community's central banks currently use either one or more monetary aggregates as 'intermediate objectives' or an exchange rate objective;

6.Points out also that the fundamental principle of the independence of the ECB and the national central banks precludes the political authorities from imposing monetary objectives;

7.Takes the view that the homogeneity and efficacy of the common monetary policy require that this policy should be the sole responsibility of the ECB;

8.Takes the view, on the other hand, that the implementation of the common monetary policy must take place in accordance with the principles of subsidiarity, with the national central banks taking as full a role as possible;

9.Takes the view, therefore, that the monetary policy instruments used during the third stage must allow of a decentralized implementation of the common monetary policy and that, in order to do this, these instruments must fulfil criteria of recognized efficacy, of uniformity of application in all countries and of compatibility with the functioning of the markets;

10.Wishes the EMI to analyse this question, with reference inter alia to the utilization and role of the compulsory reserves;

11.Wonders about the situation which might be created by an abrupt change from national monetary policies to a common monetary policy in the third stage of EMU;

12.Proposes accordingly that, as soon as the necessary conditions for the adoption of a single currency are fulfilled, and before the date set for the beginning of the third stage, an experimental stage be initiated, to consist of a common monetary policy implemented by the independent national central banks in accordance with Article 109j(3), first indent, of the Treaty on European Union; such a policy would be decided upon freely by the Member States and could be discontinued at any time;

13.Instructs its President to forward this resolution to the Council, the Commission, the European Monetary Institute and the Governments and Parliaments of the Member States.