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Vienna, 31.08.2017 Schelling: "Europe should go its own way" Financial market talks 2017 in Alpbach

Has politics around the world gone too far with regulatory measures? This question was the subject of intensive debate at the financial market talks held in Alpbach. Austrian Finance Minister, Hans Jörg Schelling, describing the work of politics in Europe as a success, expressed a critical view of the current trend towards deregulation in the USA.

"Bank regulation in the USA is evolving in a distinctly different direction from that in Europe. For this reason, Europe should go its own, somewhat more moderate, way. Some of the rules introduced after the financial crisis are undoubtedly excessive, and here, there is a need for a careful review to be undertaken. The central questions are: what is the additional benefit of a new rule, and what harm is thereby prevented? Rules which prevent no harm but only generate bureaucracy should be changed. We are currently pursuing this process very intensively with the European Commission and the other Member States," stressed Schelling.

The Austrian Finance Minister criticised US influence on European monetary policy in this regard, and expressed his support for the proposal by his German counterpart, Wolfgang Schäuble, who wishes to expand the euro rescue fund, the ESM, to form a more comprehensive European monetary fund. "The Eurogroup should itself decide how it wishes to proceed in terms of monetary policy. In my view, this idea makes sense," added Schelling.

In Schelling's opinion, it moreover constitutes a weakness on the part of the European Union that the International Monetary Fund and the World Bank do not have a euro or EU voting group. He believes this should be considered.

In addition, Minister Schelling spoke out in favour of maintaining the regional banking structure, since this is of vital importance to the financing of SMEs: "It is necessary to reinforce the principle of proportionality. Regulations designed for the major banks and which do not suit the small banks need to be adapted, and bureaucratic obstacles need to be removed. However, this should not be permitted to negatively impact upon the stability of the financial markets. For this reason, neither does there exist a simple panacea. We are working on bespoke rules. Greater proportionality in the context of regulatory law is a top priority in terms of Austria's financial-market strategy."