French MEP and former head of the economic and monetary affairs committee Pervenche Beres recently told Europolitics that the Spanish EU Presidency had come at a much better time for Madrid than Sweden's turn did for Stockholm. In fact, she said the Swedes had a "nightmare slot": a work programme brimming with financial topics set against the background of persistent uncertainty about the state of the economy.

When Swedish Prime Minister Fredrik Reinfeldt took over the reins of the EU's final rotating Presidency under the Nice Treaty, inflation was below zero, growth was still tumbling in most of the EU's economies and unemployment was on the rise.

In November, the Commission reported that the downturn had stabilised and revised next year's growth forecasts upwards. The EU's Economic and Monetary Affairs Commissioner Joaquin Almunia even proclaimed that the European economy was "no longer in freefall".

With the Lisbon Treaty ratified, Europe can finally stop navel-gazing and get down to business. The Spanish will be the first to test the waters of the new institutional set-up, aiming to make its Presidency "truly European", according to Foreign Minister Miguel Angel Moratinos.

Prime Minister Jose Luis Rodriguez Zapatero told the European Parliament's Conference of Presidents in December: "The Treaty of Lisbon gives us the means to bring about true coordination of our economic policies and we must make use of it."


While the Franco-Czech-Swedish trio presided over the EU's collective trillion-euro loan to the banking sector and real economy, Spain will need to steer away from crisis spending. This is not least because budgetary problems are on the rise: 20 countries have overstepped the EU's 3% of GDP budget deficit limit and more are expected to do so soon.

The Swedish Presidency in October and November laid down the outlines of an exit strategy, recommending that member states unwind extra economic spending by 2011 at the latest, starting with bank guarantees. The European Central Bank has already begun retrenching, publishing its last tender for 12-month loans on 15 December, a move that it introduced in May to offer banks extra cash.

Meanwhile, fiscal exits are to be tied in with the EU 2020 growth and jobs strategy - the follow-up to the Lisbon Agenda - as part of efforts to align budgets and priorities more closely over the next ten years. Spain will also have to ensure that richer member states do not gain an unfair advantage...

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