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Prime Minister Juha Sipilä’s speech to the European Parliament on 31 January 2019

Government Communications Department 31.1.2019 11.17
Speech
Prime Minister Juha Sipilä’s speech to the European Parliament on 31 January 2019

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Mr President
Members of Parliament

It is my pleasure to be here today. The European Parliament has done excellent work under the recent challenging circumstances.

Forward-looking discussions about the European Union are essential for two reasons. In order to reach the vision of the Rome Declaration, we need to discuss how we achieve sufficient unity to make decisions and implement them. Second, we must debate to discover each other’s priorities in the EU’s action and budget.

While working as an entrepreneur, I got to know many of the EU-countries through sister companies around Europe. I remember traveling to meet with the CEO of the big French company when I was in my 30s. In the plane, I was reading a guidebook that my wife had lent me. It said that you should never ask anything about family when you are in a business meeting with a Frenchman. Once I arrived at the dinner meeting, the CEO was there with his wife and daughter. His first question to me was to ask about my family. I understood that we Europeans get along, and we have more in common than we may think.

Already in 1920, the ideological father of Finland’s Centre Party, Santeri Alkio wrote that for the sake of peace in Europe, the continent should consider directing its politics towards United States of Europe. He even mentioned a common currency. He was a pioneer in many respects, as this example shows. Choosing international cooperation and generating peace and economic development have been a guiding light for Finland.

In recent years, however, we have been given a lesson in populism in Europe. We have seen what happens when people propose solutions for complex issues by oversimplification of matters. In the end, nobody takes responsibility. This was the case in the United Kingdom, and the result is there for all to see.

But it’s not only with Brexit where we see the effects of populism; in fact, this movement has hit the EU along several fronts.

Setbacks in the rule of law, the freedom of press and women’s rights are news we would not expect to hear in 21st century Europe. How can the EU promote its common values in its external policies if it cannot even do so internally?

Our common values, such as democracy and the rule of law, have been the foundation of Europe’s freedom, security and prosperity. These values should unite the Member States. We must find ways to bridge Europe’s internal divisions. At the same time, there cannot be any compromises on the rule of law.

Finland warmly welcomes the Commission’s MFF-Rule of Law proposal. I am convinced that there is a way to establish a well-balanced mechanism to this end.

Mr President, Dear Members of the Parliament

The most important cornerstones that define Finland’s position towards developing the European Union as well as a monetary union, are to respect the decisions already agreed and to carry out efficient implementation. We strongly support the kind of EU that proves its credibility through concrete action.

In 2015, my government started in the situation where the public deficit was nearly 3.5 per cent relative to GDP. We achieved 2 per cent painful savings relative to GDP. We carried out reforms to improve public finances, such as social and healthcare reform and pension reform. The internal devaluation of 4 per cent was made by boosting employment and growth. We agreed with the trade unions about salary freeze and cuts, an extension of 24 hours in annual working time and a decrease in social security contributions of the employers, to name a few. As you might guess, these actions were not very popular.

However, now after three years, the public deficit is covered, the state budget is in balance and the employment rate is the highest in 30 years.

With that said, the idea of solving these kinds of problems with permanent fiscal transfers is unacceptable to us. The best insurance against economic shocks is balanced budget and a low debt ratio.

Many times during these years, I have reminded myself, the quote by Jean-Claude Juncker: “We all know what to do, we just don't know how to get re-elected after we've done it”. On my part, I am testing this in practice in our upcoming elections.

My point is that despite of the risk, the Member States must be capable of making decisions and implementing them.

Efficient implementation is absolutely the best method to respond to the current and future challenges. We need

  • implementation of single market and RDI policies
  • implementation of internal and external security policies
  • implementation of migration policies
  • implementation of climate policies.

Better implementation is the best tool in fighting against populism and in increasing the citizens’ confidence in the European Union.

Ladies and gentlemen

Finland holds the Presidency of the Council of the European Union in the second half of this year. I would now like to point out in more detail some of the areas that will be on the agenda during our presidency. These are also topics where the EU must be able work more closely together and walk the talk efficiently. 

The multiannual financial framework (MFF) is a key implementation tool for future EU policy.

In Finland’s view, the overall level of the MFF should be as close as possible to the current relative share.

The focus needs to be in areas where the EU is best placed to deliver, like on migration, security, single market, innovations, digitalization and climate. We also see that there is a need to reallocate funding to rural development within the budget. The common agricultural policy helps to provide affordable and safe food to the EU citizens. It also ensures that farmers can make a reasonable standard of living and promote jobs in farming and food industries. At the same time, cohesion policy creates more balanced development between and inside the Member States.

I am confident that we will be able to find a balanced compromise between traditional policy areas and new challenges. I am also confident that we can do it during the Finnish Presidency.

Second, we need migration policy with comprehensive approach.

First, the root causes of migration must be addressed more effectively. In addition to development cooperation and humanitarian aid, trade and investments are needed to create jobs and sustainable development. We must also work hard to make the return policy more effective.

The internal aspect of migration is in our own hands. We should manage migration increasingly through direct resettlements from the refugee camps. This would mean smaller pressure on EU’s external borders and less smuggling. At the same time, the management of our external borders should be reinforced. There is also a need to proceed with the most complicated political issues, like the mechanism on solidarity during crises. It is crucial we agree on this in advance, not in the middle of a crisis as we did in 2015.

Third, security and defence cooperation are also important and need to be intensified.

Finland has been actively calling for ambitious progress in security and defence cooperation, also together with France. We welcome the progress in this issue.

The establishment of the European Defence Fund and PESCO are also steps in the right direction. We should now concentrate on implementation and reaching results.

The EU has also strengthened its capacity to counter hybrid threats. The European Centre for Countering Hybrid Threats in Helsinki contributes to the preparedness of NATO and EU countries against these threats. I want to thank the 19 participating countries, from which 16 are EU Member States, for the strong commitment. I would also like to extend an offer to all other Member States to join the Centre.

Fourth, we must improve the Single Market.

We have the best single market in the world. In addition to innovations and trade, this is our best way to create new jobs. A lot of potential exists especially in services and digital products. Improving the situation is fully in our own hands: I urge to find a common mindset to pass those 35 proposals that are currently still under negotiations.

Looking ahead, I hope that the new Commission will take a more holistic approach where the Single Market, digitalisation, industrial policy and external competitiveness are better interlinked. We should aim at a forward-looking growth strategy. This includes among other things, data mobility and artificial intelligence.

It is also important to enhance the competitiveness by implementing the principles of the EU’s social pillar. It is for instance crucial to promote equality in working life and to enhance education levels of all citizens.

Fifth, trade policy is also crucial for the EU’s competitiveness and new jobs.

In respect of free trade agreements, I am pleased with the latest achievements with Japan, Vietnam, Singapore, Mexico and Canada, and wish fast progress in the ongoing negotiations.

However, it is very harmful if the major players continue to build trade walls. We must do everything to prevent or tear down such walls. Especially from the view of smaller countries, the damage would be fatal. We must respect and obey the common rules on trade.

Finally yet importantly, the EU must take the lead in climate action.

The report of the International Panel on Climate Change again reminded us of the threat posed by climate change to life on earth.

We cannot walk away from science. Besides the threats to our climate, I see many opportunities in this global challenge. As an engineer, I tend to think in a solution- and technology -based way. I am sure that as the world moves towards low-carbon development and we are in the frontline in developing new climate technologies, ambitious climate policy will also support the competitiveness of Europe.

This means that we need measures on three fronts: carbon dioxide emissions, carbon sinks and new technologies.

Last week, Finland hosted the Nordic Climate Meeting in Helsinki. The Nordic countries gave a promise to raise the level of their climate ambition by 2020. The Nordic countries want to catalyse efforts to limit the global warming to 1.5 degrees Celsius.

Additionally, during roundtable discussions in the Finnish Parliament, eight Finnish political parties set an objective that the EU should achieve carbon neutrality before 2050. That requires tightening of the emission reduction obligations for 2030 to at least 55 per cent of the 1990 level.

The EU Emissions Trading System (ETS) is the most cost-efficient way to reduce greenhouse gas emissions. Finland aims to renew the system so that the price of emission allowances will guide operators towards emissions reductions more quickly and efficiently. We have proposed that new sectors such as the heating and cooling of buildings should be integrated into the ETS.

Furthermore, we have to accelerate the transition towards a circular- and bioeconomy. The bioeconomy action plan should be implemented without delay.

Measures are also needed to increase carbon sinks.

Our world has four billion hectares of forests and five billion hectares of fields. It has surprised me how much more carbon dioxide could be bound in agricultural fields if we made some changes in farming practices. We have 100 ”carbon farmers” testing new practices in Finland. Oceans and carbonate minerals can lock down carbon dioxide as well. We also need to plant more forests.

In Africa alone, 2 million hectares of forests are lost every year. That is equivalent to Slovenia’s total land area.  As FAO’s report on the State of the World’s Forest says, the world’s response to climate change must focus more on forests.

One concrete step we should take is to use the EU’s external funding to increase global carbon sinks. Finland has proposed an EU-Africa Forest Fund. Forest investments would maximize the impact on climate and on rural jobs in Africa.

Finally, we must adopt new technologies.

Even now we have the technical capability to capture carbon dioxide from the air and convert it to other products. The EU needs to invest in research and development and to better exploit the huge potential of science, technology and innovation in this area.

We also have to think in innovative ways to create new incentives and apply market-driven methods to ensure that we increase carbon sinks.

My strong message is that we have to do more and faster. We must reduce emissions, increase the carbon sinks and adopt new technologies.

After the European Parliament elections, the European Council needs to agree an ambitious and comprehensive Strategic Agenda. Along with climate issues, our focus should be on growth and security. In addition, rule of law issues will remain central.

Dear Fellow Europeans

This is my call for a more united EU that is capable of concrete actions, implementation and bearing responsibility. This means taking responsibility for ourselves, for the people and surroundings close to us, for the economy, and for the planet.

Let’s remember that we are all here to safeguard a better future for our youth and generations to come. For their sake, we need determined, efficient and united European Union.

I cannot highlight more the importance of getting things done. That is why I have underlined the word implementation in this speech so many times. Democratic forces of Europe will win back the trust of the people by making decisions and by implementing them, at home and here in Brussels.