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Aleksandr Gurnov: Hello again, and welcome to Spotlight, the interview show on RT. I am Al Gurnov and my guest on the show today is Jean-Claude Juncker.
The huge economic troubles that we are witnessing in Europe, or rather in some European countries, have been the centre of attention of press around the world through, quite a while now.
Some people say that Europe is about to collapse. Huge economies, Germany, France, are trying to save the Eurozone, are trying to save the situation in that region. But some say that it is doomed. Is that true or not?
The man who surely knows the answers to these questions is the Prime Minister of Luxembourg, Mr. Euro as they call him in the press: Jean-Claude Juncker.
Presentation: As financial future of Europe remains uncertain, it vitally needs support of Eurobonds-holders, and the holders need a stable Euro.
The Prime Minister of Luxembourg, Jean-Claude Juncker is a man who coordinates this important process. Juncker is known far beyond the borders of his tiny country. In fact, he is the President of Eurogroup and oversees Europe’s monetary policy.
Pragmatic, a bit cynical and extremely professional, Juncker is a consistent advocate of European integration. In one of his interviews, Juncker says that Europe will either succeed or fail together.
Aleksandr Gurnov: Hello Mr. Juncker, welcome to the show. Thank you very much for being with us on the programme.
Jean-Claude Juncker: It’s a pleasure.
Aleksandr Gurnov: Well, first of all, when I read about you in the press, the media call you "Euroboss" and "Mr. Euro". What are your responsibilities, and are you really the number one official in the Eurozone today? Is it true?
Jean-Claude Juncker: As you know, and this is the case for your channel too, the media always are exaggerating.
Journalist: Right.
Jean-Claude Juncker: I am not a number one, I am amongst the number ones, I am responsible as chairman of the Eurogroup for the coordination of economic policies. But I am not in charge of monetary policy, that is the job of Mr. Draghi, the president of the European Central Bank.
But I am trying to do my best in order to bring all these 17 countries, making part of the Euro area, together when it comes to real issues.
Aleksandr Gurnov: Well, since you are having this function of coordinating the efforts of the zone, can you tell us, is there a simple explanation of what’s going on in the Eurozone today, or the reasons of this, what the press – the exaggerating press – calls the greatest crisis of all times?
Jean-Claude Juncker: Apart from your channel, and others, there is never an easy explanation to phenomena we are watching.
No, we don’t understand in fact why the Euro area is at the centre of the global threat. Because our basic fundamentals are better than those of Japan, than those of the US, and those of Britain or others. We have a smaller average budget deficit than the other areas I was referring to. We have a lower public debt than the other areas – US, Japan, Britain – I was referring to.
And so, we do think, from time to time, that we are submitted to a stress test by those who don’t want the European Union to appear like a leading monetary power in the world. We don’t understand what is happening.
Aleksandr Gurnov: Many economists say that the Eurozone is doomed. Well, what are the chances really that the Eurozone may collapse in the near future?
Jean-Claude Juncker: I don’t think that there is any chance for the Eurozone to collapse [interruption]
Aleksandr Gurnov: You consider it to be stable enough, despite the difficulties [interruption]
Jean-Claude Juncker: The Euro, given its good performances as far as the exchange rates are concerned, is a stable currency. The Euro is amongst the most stable currencies in the world, more stable than the US, more stable than the Yen, more stable than other international competitors, as far as the exchange rate is concerned.
Those who are considering that Europe could break down, those who are considering, thinking, wishing that the Euro would collapse, will have no chance to destroy this current currency, because the common European currency, the Euro, is not only about monetary policy, is not only about economic policy, it is a part of a larger political project. It’s the chance of our generation to prove, as far as our relation with the outside world is concerned, that we have something to tell the world.
Without the Euro we would not really exist in the next coming decades. With the Euro – and that’s the reason why we will have to permanise the Euro – we have a say in the world.
Aleksandr Gurnov: Russia started after Soviet times by being a Dollar-oriented economy. But more and more, year after year, Russia is becoming more and more integrated into European processes, including the economic processes. So, how much do you think today, Russian economy is dependent on the Euro?
Jean-Claude Juncker: I wouldn’t say that the Russian economy is dependent on the Euro, but I would like to say that if the Euro were to collapse, Russia would be one of the first victims, because [interruption]
Aleksandr Gurnov: And you call it independence? And you say, it’s not dependent, but it will suffer [interruption]
Jean-Claude Juncker: It is not dependent, but as all these things are intimately interrelated, and as Russia has a huge part of its currency reserves expressed in Euros, of course Russia would be a potential victim.
We are very grateful to Russia for behaving in an as responsible way as Russia is, when it comes to the so-called Euro crisis, which is not a crisis of the Euro, but a crisis of public debt inside several member states of the Euro area. I do think that the European Union as such, and the Euro area in particular, has to preserve this strategic relation we do have with Russia. And Russia is behaving in a very responsible way, when it comes to monetary policy, and to economic policy in the broader sense of the word.
So, Russia is a partner, and Russia could easily be a victim, if the Euro were to collapse. But as this will not happen, Russia will be forever a happy victim.
Aleksandr Gurnov: Well the Russian government, it always tells the Russian people that we, they say, "never put all the eggs in one basket". Is it the right strategy, do you think is it a wise strategy for Russia to minimise the possible negative effects of a crisis?
Jean-Claude Juncker: Sometimes it happens that you have easy answers to complicated questions.
Aleksandr Gurnov: That’s what we try to find always.
Jean-Claude Juncker: Thus my answer is yes.
Aleksandr Gurnov: Okay. Well, what is the worst possible scenario for the Eurozone? I mean, do you think that there may be some sort of a development throughout the crisis, effects that may influence really the world economy, global economy?
Jean-Claude Juncker: We have put instruments in place in order to fight against, what you are calling the Euro crisis, and which it is not a Euro crisis, but a crisis of public debt inside several countries of the Euro area.
We were without any weapons, arms, instruments three or four years ago, but now we have put into place instruments able to enable us to fight against what you are insistently calling the Euro crisis. And we have put into place so called umbrellas, where member states, where failing member states will have, could have and have a good address in order to be supported by other members of the Euro area.
So this idea, this dream, this wish of some of our partners, so called partners in the Anglo-Saxon world, that the Euro would collapse, this scenario will never enter reality.
Aleksandr Gurnov: Mr. Juncker, we were talking about the problems, about the crisis in the economies of some countries inside the Eurozone. Well, austerity measures are one of the main measures that are taken to try to overcome these things. Do you think that this is a main lever to solve the problem?
Jean-Claude Juncker: It’s not the main instrument to solve the problem. But you have to know, if you are adding, year after year, deficits over deficits, and public debt to public debt, you cannot really overcome the crisis we are in.
We have highly indebted countries in Euro area. And as we have to make sure that all the Euro area countries, the 17 countries belonging to Euro area, are heading in the same direction, we have to impose in a way, in a compulsory way budgetary discipline. There is no alternative to consolidation. And that’s exactly what we are doing.
But the problem we are facing is not only a public finances problem. The problem we are facing is a problem of large, broadening divergences between the different sub-economies of the Euro area. So, we have to put the focus on the narrowing of the competitiveness situation of the different Euro area countries.
The problem of Greece is not only a budgetary problem. The problem of Greece is, that since Greece joined at the beginning of this century the Euro area, the loss, in terms of competitiveness was huge. And that’s not feasible, in a future-oriented way, if member countries are showing large and huge divergences, as far as economical competitiveness is concerned. So we have to focus both, on budgetary consolidation and on the improvement of the competitive situation of member states.
Aleksandr Gurnov: Jean-Claude Juncker, Prime Minister of Luxembourg and "Mr. Euro", as the press calls him. Spotlight will be back in a minute or so after we take a small break. Do stay with us.
[Break]
Aleksandr Gurnov: Welcome back to Spotlight. I am Al Gurnov and I might just remind you that my guest on the show today is Jean-Claude Juncker, the Prime Minister of Luxembourg, and a person who the press calls "Mr. Euro", or the "Euro boss".
Let’s talk about the EU-Russia relations. After the summit, the EU-Russia summit in June, some analysts have been saying that the talks between Russia and EU make little progress; that a framework agreement is far from being signed. So, why can’t the parties find common ground for such a long time?
Jean-Claude Juncker: I was not sitting around this EU-Russia summit table. Although it would have been better if I had so.
But I do think, that on both sides, Russia and the European Union, we have to have a better understanding of the strategic relation, existing now and in the future between this great nation Russia and the European Union. I do think that we have to improve our performances when it comes to the bilateral relations with Russia and the European Union.
Aleksandr Gurnov: What do you think are the areas where Russia and the EU may cooperate best?
Jean-Claude Juncker: I do think that a privileged centre of common interests should be economic policies to be organized in a more parallel way than they are today.
I do think – but this is not a matter for the European Union, but for NATO – that we have to better understand that the strategic relation between Russia and the Western European world is to step away from what we have gone through during the Cold War. That was a real competition – to put it friendly – between Russia and the NATO members.
We are in charge of peace and freedom of the European continent. That’s why we are saying, and that’s why I am saying, that there is a real strategic relation to be established between Russia and the European Union.
And I do think that, apart from the fact that Russia from time to time is behaving in a wrong way, that the European Union too is behaving in an improper way. I do for example think that, as far as the visa question between Russia and the European Union is concerned, that we have to make all the efforts which are requested in order to bring this issue to a negotiated better end.
Aleksandr Gurnov: Mr. Juncker, one of the issues, one of the topics of your visit and your talks here in Moscow is the proposal of visa abolition between Russia and the Europe, and the Schengen zone.
What do you think prevents Russia and Europe to find a signed agreement? Because the Russian leaders have been saying, this will happen very soon. But it is not happening. What is the problem?
Jean-Claude Juncker: European leaders were saying exactly the same thing. But, when politicians are announcing that things will happen immediately, you can be sure that things will take time to happen.
Aleksandr Gurnov: Is it technical or political?
Jean-Claude Juncker: It is both, technical and political. But I do think that it is mainly political.
We have to step away from this Cold War-atmosphere we had when we were in the middle of the Cold War. And some in the west, and some of the European Union member states are still considering Russia as being not our partner, not our ally, but an ensemble we have to protect ourselves against.
That’s not my point of view. I do think that nothing useful, nothings sound, nothing hopeful will happen in Europe, if we are not considering on both sides that we have to move in the same direction.
And this visa issue is not only a symbolic one, but it is an instrumental one. Because, if Russians having a so-called service passports will be entitled to travel through Europe in a very normal way, as Russians and other Europeans should live together, then we won’t have understood what duties the new world is asking us to deliver.
Aleksandr Gurnov: Mr. Juncker, you are talking about Russia in a way, that I feel that you really do have a lot of sympathy to this country. I know that you will be in Tambov this week to open a monument to soldiers of Luxembourg that fought here in Russia, that suffered from the Soviets, as a matter of fact. Your father, as far as I know, was one of them, one of them who suffered. So, can you tell me, what is personal for you in your relation to Russia, and how do you see all today?
Jean-Claude Juncker: My father was not really suffering from Russians, or from the Soviets. My father, together with three of his brothers, and together with thousands of young Luxembourgers, was incorporated by force into the German army, because Luxembourg has been occupied by the German, by the Nazis.
Aleksandr Gurnov: Which was a painful experience, wasn’t it?
Jean-Claude Juncker: Which was a painful experience, and it happened twice in the last century. That’s by the way, the reason why we are so strongly, intensively working in favour of the European integration and European unity. Because a small country like ours is always the theatre of the military opposition between the major political powers in Europe, as a rule between Germany and France. We were always the victims of that.
And so these young men were incorporated by force into the German army, and they were sent to Russia, to Poland, to other parts of the continent. My father never told me that he had bad experiences with Russian soldiers, or with Russian civilians, but by the end of the war all these Luxembourgish soldiers, who didn’t want to be German soldiers, but who were obliged to be German soldiers, were made prisoners by the Red Army. And the Red Army didn’t make a distinction between German and Luxembourgish soldiers. All [interruption]
Aleksandr Gurnov: Were they imprisoned, or did they give themselves up?
Jean-Claude Juncker: Some of them, many of them deserted to the Red Army, the most virtuous of them were deserting, but even if they deserted [interruption]
Aleksandr Gurnov: They were captured as prisoners anyway.
Jean-Claude Juncker: The Russian officers didn’t make a difference between Luxembourgish-German soldiers and German soldiers. And they were trying to explain their specific situation. But how could you expect – by the end of the war Russian officers and other Russian officials could make a difference between these poor Luxembourgish guys, being incorporated by force into the German army, and those who were German soldiers by conviction. They were not German soldiers by conviction. The proof is that many, many of them deserted to the Red Army.
But my feeling is, in fact an emotion, that by visiting Tambov and by inaugurating this monument, remembering the sufferance of this lost generation of young Luxembourgers, it is a return to the tragic history of my country. I was born in 1954, just before you [interruption]
Aleksandr Gurnov: A couple of years, it was in 1957.
Jean-Claude Juncker: You are looking like 1955.
We are young, we were never victims of the injustice. We were never thrown into a period of history, which was not our period, but the period of those who were responsible for that.
And I am very grateful to the Russian authorities, mainly President Medvedev, because we started this idea of having this monument when Medvedev was President. I am very grateful to the governor of the region of Tambov, and to the municipal authorities there, that they were as helpful as they were. Because, okay, this part of our common history, we were victims, the Russians and the Luxembourgers, but on different sides of the confrontation. And now, having understood that in fact both of us were victims, because we were fighting against the Nazis, the Russians and the Russian people, and the Russian people paid a huge price for that, and the Luxembourgish people, and these poor soldiers being incorporated into the German army, we have understood that.
And now we are responsible for the decades to come. That’s our duty, the duty of the 1954s, and those looking not very much younger.
Aleksandr Gurnov: You said that Medvedev, when he was president, the Russian authorities are pretty friendly to you, as a representative of Luxembourg. I know why. I think one of the reasons is that Luxembourg is the third largest investor into Russian economy. How come, how is that, that a small country like Luxembourg is the third largest investor?
Jean-Claude Juncker: We are a worldwide leading financial centre, and we are focussing on financial services, and so we are, as far as foreign direct investors are concerned, amongst the leading partners of Russia.
But that’s not the reason why we have an as strong relation between this huge, great Russian nation and this small Grand-Duchy of Luxembourg. The reason is that we are trying to understand, in a better way than larger countries are trying to do it, the deep nature of Russia.
We will never forget that Russia was amongst the countries who liberated our country during the Second World War, even those who are by far younger than the real war generation do know, that Russian soldiers were dying on our territory, do know that without Russia we would never have had our liberty, and freedom. We were not only liberated by the US-forces, we were also liberated by the Red Army.
And we are amongst those, and we are only few countries in number of that kind, who are not publicly lecturing Russia. We do have more or less huge differences with you, when it comes to human rights, and issues of that kind. But I don’t think that the west is well inspired, if the west is always lecturing others how to do things. We should do our own business.
But when I’m meeting President Putin, Prime Minister Medvedev, or in former times, when they had different roles, I’m always mentioning these questions. But it is not a proof of courage, if you are giving the impression at home that you are lecturing the Russians. We have to talk about these issues, we have to discuss this indeed.
And so I do think that the so called popularity we have in Russia is due to the fact, that we are serious when it comes to common issues.
Aleksandr Gurnov: Thank you, thank you very much for being with us. That was Jean-Claude Juncker, Prime Minister of Luxembourg, talking to us on Spotlight.
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