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EU commissioner calls for troika to be abolished

Wednesday, 17 Jul 2013 | 3:50 AM ET
Johannes Simon | Getty

EU Justice Commissioner Viviane Reding has called for the "troika" of the European Commission, the European Central Bank and the International Monetary Fund to be dissolved, a German newspaper said on Tuesday.

"The troika should be abolished," Reding was quoted as saying in an advance copy of a report due to be published in Stuttgarter Zeitung on Wednesday, adding that European problems should be solved in Europe without the IMF's help.

"(The troika) was necessary in an emergency situation when something had to be established quickly but now Europe has the necessary instruments and experience to carry out appropriate analyses and intervene in economic and financial issues."

The troika negotiates with crisis-stricken countries like Greece, Portugal and Ireland on the austerity and reform measures they have to undertake in return for bailouts. It also supervises the implementation of such steps.

Reding said the EU Commission was better placed than the IMF to work towards a social market economy as the EU Treaty required it to do that. She said it was absurd that people in countries like Brazil and India with a lower gross domestic product (GDP) per capita than Greece should pay for Greece.

Germany and Finland have insisted on the IMF's involvement in crisis management.

However, German Finance Minister Wolfgang Schaeuble said last month that the IMF's involvement could not be a permanent solution, though he said it would only be able to withdraw in the long-term once current programmes had come to an end.

Reding said the fund could leave in a couple of months.

Other European officials, including Klaus Regling, head of the euro zone's bail out fund, have also said the IMF should not play a role in the longer term in euro zone rescue packages.


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