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Juncker at EU helm - rough seas ahead?

Tuesday, July 15, 2014 - 02:16

Jean-Claude Juncker outlines a 300 billion euro programme of incentives for member states to make ambitious economic reforms, ahead of a vote confirming his appointment. As markets once again fret over the progress of the EU recovery, Juncker has major challenges in store as the next president of the European Commission. Ciara Sutton reports.

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His nomination ruffled a few feathers in the EU. But Jean-Claude Juncker, the next Commission President, won by large majority in the European parliament. The former prime minister of Luxembourg is now focussing on how the region can recover together. (SOUNDBITE) (English) Jean-Claude Juncker, next European Commission President, saying: ''We have to replace deficits and debt with ideas. These ideas are there. We must knock down these barriers to growth." Juncker wants to create incentives for countries adopting ambitious economic reforms. He's called for a 300 billion euro investment programme to revive the European economy and create jobs for young people. Europe's recovery has hit the headlines again in recent days. The ECB cut interest rates to record lows last month as it tries to breathe life into a sluggish euro zone economy. But ECB Chief, Mario Draghi says a stronger euro exchange rate is still a threat to progress. (SOUNDBITE) (English) ECB CHIEF, MARIO DRAGHI, SAYING: "The ECB continues to stand ready to take action if necessary to further address risks of a too prolonged period of low inflation." The French government and plane maker Airbus have called for steps to devalue the common currency as it risks hurting exports. The IMF says any new financial shocks could stall the euro zone recovery. Fortis Chief Strategist Philippe Gijsels. (SOUNDBITE) (English) FORTIS CHIEF STRATEGIST PHILIPPE GIJSELS, SAYING: "They will have to find some kind of compromise between austerity, bringing the budgets in order, which is still clearly needed, but on the other hand keep growth going. If you hear the IMF this morning and also the ECB, Commission and other saying that the euro is too strong and the European economy is not doing as well as thought then that is clearly an issue." And worries over Portuguese bank Banco Espirito Santo continue to eat away at sentiment - its shares now falling to record lows. Portugal's largest listed bank has been dogged by worries over its exposure to the troubled companies of its founding family. And reform of the banking sector is something the IMF is calling for. One of many pressing items Juncker may have to deal with when he takes office as expected in November.

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Juncker at EU helm - rough seas ahead?

Tuesday, July 15, 2014 - 02:16

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