Keravnos sets out Cyprus presidency priorities at first ECOFIN meeting

Finance Minister Makis Keravnos on Tuesday presented the programme of the Cyprus Presidency of the European Union Council during the first meeting of EU finance ministers in Brussels under Cyprus’ term.

“A self-reliant union open to the world is the slogan of our presidency,” Keravnos said.

“Guided by this slogan, we are committed to delivering an ambitious and impactful presidency,” he added.

“We want to create momentum towards a prosperous and more competitive Europe,” the minister pledged.

Keravnos said Cyprus is taking over the presidency at a time of international geopolitical realignments and uncertainty, with the European Union facing multiple challenges.

“In the field of economic and financial affairs, strengthening the European Union’s economic autonomy and reinforcing its economic position will be our core principles for the next six months,” he said.

He also underlined the specific role of ECOFIN in decision-making, stressing that the Council can reach concrete proposals and decisions within the political direction set by EU leaders.

The presidency intends to advance legislative work on the Savings and Investments Union, while ensuring sufficient progress on the Capital Markets Union agenda aimed at boosting competitiveness and deepening banking sector integration.

In the area of taxation, Keravnos said the presidency will promote the EU programme for simplifying tax legislation as part of broader efforts to strengthen competitiveness.

He further stated that Cyprus will also seek to push forward legislative work towards a modernised Customs Union.

“A central priority will be to ensure that the EU continues to financially support Ukraine,” Keravnos said.

“We are fully committed to ensuring that Ukraine receives the necessary and timely funding to support its defence and help with its future reconstruction,” he added.

Turning to the agenda of Tuesday’s meeting, Keravnos briefed the press on the approval of mainly technical and targeted amendments to the Recovery and Resilience Plans of Finland, Germany, Ireland, the Netherlands, Spain and Sweden to accelerate implementation.

Regarding the European Semester, he said no member states were found to require an in-depth macroeconomic review.

“ECOFIN will continue to monitor the situation in the seven countries identified in 2025 as having imbalances,” he said.

Keravnos also referred to the opening of an excessive deficit procedure for Finland, after its public deficit exceeded treaty limits in 2024.

Finland’s deficit reached 4.4 per cent of GDP in 2024 and is forecast to exceed the limit again in 2025 at 3.5 per cent, he said.

“We asked Finland to report on progress in implementing these recommendations at least every six months, in spring through the annual progress report and in autumn through the draft budget, until the excessive deficit is corrected,” Keravnos said.

“Finland must end the excessive deficit situation by 2028,” he stated.

Referring to the informal breakfast session of the Council, Keravnos said finance ministers exchanged views on current economic challenges and political developments.

“These discussions also included Greenland,” he said.

“The European Union stands firmly alongside Denmark and the people of Greenland,” Keravnos said.

“We remain united behind our principles regarding respect for international law and particularly the principles of territorial integrity and sovereignty,” he added.

“As you know, leaders will meet here in Brussels on Thursday evening to assess the situation and coordinate next steps,” he said.

“Finance ministers are ready to take any follow-up actions based on the guidance we receive from our leaders,” he added.

“It is vital to have a practical and strong European response,” he said.

Asked whether heightened geopolitical developments would affect discussions at ministerial level on implementing the presidency programme, Keravnos agreed.

“I think it will affect it positively,” he said.

“We need to focus more on certain priorities, speed up procedures and take political decisions as soon as possible on very specific issues, because developments are clearly moving fast,” he added.

European Commissioner for Economy Valdis Dombrovskis expressed confidence in close cooperation with the Cyprus Presidency at the opening of his remarks.

“I welcome the strong emphasis in the work programme and the focus on competitiveness, defence and the digital euro,” Dombrovskis said.

“I am ready to work closely with the Cyprus Presidency to deliver the programme’s milestones,” he added.

On EU-US relations, Dombrovskis said the European Union must act with unity and determination.

“More than ever, our union must show unity, determination and strength, and work to reinforce our competitiveness and defence capabilities,” he said.

He referred to discussions on the EU’s economic outlook in light of geopolitical developments and pointed to the extraordinary European Council meeting on Thursday.

“We are in full solidarity with Denmark and Greenland,” Dombrovskis said.

“Any challenge to the sovereignty of a member state is unacceptable,” he added.

“We are keeping all options on the table, but the priority remains constructive cooperation with the United States,” he said.

Responding to Dombrovskis’ remarks, Keravnos said the issue has both political and economic dimensions, including the question of tariffs.

“Finance ministers have a role to play, along with our colleagues in trade ministries,” he said.

“We are awaiting the outcome of the leaders’ discussions so that we have a clear basis on which to build our responses and arguments,” he added.

“Finance ministers will be able to reach concrete proposals and decisions within the political direction that is given,” he said.

On Ukraine financing, Dombrovskis referred to €90 billion in financial support aimed at strengthening fiscal sustainability and defence capacity.

“This is critical to ensure a just and lasting peace and real security for Ukraine and Europe in the long term,” he said.

He said the intention is to complete the legislative process by March 2026, allowing initial disbursements to begin in April 2026.

Asked whether threats of US tariffs could affect plans for European governments to purchase weapons from the United States for Ukraine, Dombrovskis said the commission’s position remains unchanged.

“Our proposal remains essentially unchanged, with priority given to producers in Ukraine, the EU and the EEA, as well as countries with EU security agreements,” he said.

“There is scope for derogation if needs cannot be met within Europe, because the priority is to cover Ukraine’s real defence needs,” he added.

“There is broad agreement on the principle of graduated priority, Europe and its partners first, with the option to purchase elsewhere if necessary,” he said.

Keravnos also expressed condolences to Spain following a fatal rail accident in Andalusia.

“We all stand in solidarity with the Spanish people at this moment,” he said.