ECONOMY AND FINANCE : CRISIS DICTATES CZECH PRESIDENCY'S PRIORITIES.

The economy (along with energy and external relations) is one of the priorities of the Czech EU Presidency during the first six months of this year. "Due to the financial crisis, it is necessary to prepare for the threat of a significant slowdown in economic growth or even an economic downturn, with all its social, political and international consequences," stresses the Presidency's work programme, formally presented on 6 January.

It particularly insists on reinforcing the transparency and stability of financial markets and on the need to "revive the economic growth of the EU economies". It also notes that the "common framework" for the coordination of the EU's and member states' efforts is constituted by the European economic recovery plan adopted by the European Council in December 2008 (see Europolitics 3658).

Two other objectives are put forward by the Czech Republic in this context. Firstly, the development of human capital by supporting teaching and research and lifting restrictions still in place on the internal market. Then, the dismantling of external barriers, as the EU must not, under the pretext of the economic crisis, "put up with the stalling of the process of world trade liberalisation, with persisting obstacles to access to other markets, unfair competition".

More specifically, the Czech programme sets out the following initiatives to deal with, particularly in the monthly sessions of the Ecofin Council:

- Three major topics are given to manage the current financial and economic risks: the recovery of financial markets and discussions about better regulation; coping with the decline in economic growth; and the preparation of the EU for international debates on the global financial architecture. "In the worsened macroeconomic situation, a regular assessment of stability and convergence programmes and national reform programmes will take place in early 2009," says the programme.

- In the field of financial markets, priority issues will include the review of Directive 2006/49/EC on the capital adequacy of investment firms and credit institutions, negotiations on the directive regulating the insurance sector, the regulation on credit rating agencies and the directive on electronic money institutions.

- The Presidency will respect the European economic recovery plan, but notes that "in the long term, an overall enhancement of the EU's competitiveness is the best tool for mitigating the impact of the financial crisis on European...