The Eurogroup must be eliminated from the European Union’s institutional framework. There are no underlying reasons left to maintain an institution that has been outpaced by the course of the European project itself. The success of the euro and the financial integration it has steered us toward, even though it is not yet complete, has left the Eurogroup without a raison d’être. At present, ECOFIN —the EU Council for Economic and Financial Affairs— is the real forum for representation and debate of the member states, and, together with the European Parliament’s Committee on Economic and Monetary Affairs, it co-decides in the legislative arena. There is no longer any need to further complicate the European Union’s institutional maze. It is time to make the Eurogroup disappear.
“The success of the euro and the financial integration it has led us toward, even though it is not yet complete, has left the Eurogroup without a raison d’être”
In 1998, and following the European Council’s approval at the end of the previous year, the Eurogroup was formally created as an informal body for debate among the ministers of economy or finance of the member states that were progressing toward adopting the euro. Back then, the single currency did not yet exist, but neither did we have a regulatory framework in the financial realm that was remotely uniform. Nevertheless, it was foreseen that the euro’s entry into circulation would compel new milestones in European integration, demanding a higher degree of harmonization of banking, insurance, and capital markets regulation, as well as coordination of national tax and fiscal policies. It made sense, then, to have a forum for debate representing the states that would adopt the euro to discuss these matters.
Likewise, the enlargements of the Union in 2004, 2007 and 2013, in which not all new members adopted the euro as their currency in their early steps within the Union, justified the existence of the Eurogroup, to the extent that a significant portion of the member states were not yet participating in the euro. For example, after the first of those enlargements that brought the Union up to twenty-five states, only twelve used the euro. Now, the situation has changed dramatically since then.
The next January 1, 2026, Bulgaria will join the euro. This means that all EU member states will use the single currency, with the exception of the Czech Republic, Sweden, Hungary, Poland, Romania and Denmark. That is, in twenty-one of the twenty-seven EU states, the currency in circulation will be the euro, and not any other. Additionally, with the exception of Denmark, which has an opt-out [voluntary exit], the other five countries still outside the euro will have to join at some point, as explicitly stated in the Treaties of the EU. Thus, one may wonder why maintain a forum parallel to ECOFIN, given that any executive or legislative decision that passes through the member states requires the approval of the sole institutional representation body of the countries themselves, namely ECOFIN.
“On 1 January 2026, Bulgaria will join the euro. This means that all EU member states will use the single currency, with the exception of the Czech Republic, Sweden, Hungary, Poland, Romania, and Denmark.”
After the financial and fiscal crisis of 2008-10, the Union has endowed itself with a banking union around the euro, a single supervisor, a single resolution framework, and a resolution fund to address banking crises. The entire set of banking regulations has made an extraordinary leap in its integration, as well as in the overall supervisory framework, also in capital markets and insurance. And all of this has been achieved through ECOFIN in ongoing negotiation with the Parliament. There remains, without a doubt, work to do in that integration of savings and investments, but that extra effort does not require an institution like the Eurogroup which, on the other hand, has become more of an obstacle than a driver of such debates. At present, its intergovernmental nature, distant from the Community method, is blocking further progress, imprisoned by a decision-making system based on the lowest common denominator, with no room, given its institutional design, for the ambition the situation requires.
Moreover, in comparative terms, no other Community policy with very different implications for distinct groups of States has ever had a forum similar to the Eurogroup. Neither the management of migratory flows has been discussed solely by the exterior-bordering countries. Nor has the Community’s fishing policy been encapsulated in a debate exclusive to coastal states. Nor have aid to outermost regions or to mountain areas been confined to a closed interlocution among the countries sharing those characteristics. Not even in a matter as critical to the formal sovereignty of States as the free movement of people within the Schengen area, of which not all EU countries are part, but some non-EU countries are, has there been a debate forum complementary to the EU Council of Justice and Home Affairs.
Europeans have assumed that such policies, and many others, condition the Union as a whole and that, therefore, they must be discussed and agreed upon by all, that is, among the representatives of the member states through the EU Council, in its various formats (ECOFIN for economic matters) and among the representatives of the citizens in the European Parliament.
“There remains much to be done for the economic integration of the eurozone and the Union, which are already almost the same, but the Eurogroup has become an obstacle that must be eliminated to achieve such an objective”
In 2021, I wrote in my book ‘Returning to the Roots’ (Clave Intelectual): “The Eurogroup is subtracting power from the Community institution for defining economic and financial policy by the Council, ECOFIN, and it is doing so without transparent accountability. And, to the extent that the countries that have not yet adopted the euro quickly move along that path, the Eurogroup should dissolve into the very ECOFIN.” I must acknowledge that the candidacy of Spain’s Minister of Economy, Carlos Cuerpo, to the presidency of the Eurogroup represented the last hope to reorder the work of such an institution, which had languished due to the success of the single currency itself, the functionality of the negotiations between ECOFIN and the Committee on Economic and Monetary Affairs of the Parliament, and the self-blocking of the Eurogroup itself by its institutional design. Now I can state with even greater conviction that there is no better option than dissolving the Eurogroup.
There remains much to do for the economic integration of the eurozone and the Union, which are already almost the same, but the Eurogroup has become an obstacle that must be eliminated to achieve such an objective.
