Published: 03.11.2020
  • The Governing Council conducted a previous strategy review in 2003.
  • The new strategy that is being announced today follows a thorough review, which was launched on 23 January 2020. Over the last 18 months, the Governing Council has held numerous seminars, presentations, discussions and meetings dedicated to all elements of the review, under the overarching idea of leaving no stone unturned.
  • The current review has drawn on an immense collective effort by staff at the ECB and the national central banks of the euro area, organised in 13 separate work streams.
  • In the framework of the review, the ECB and the national central banks also hosted numerous listening activities with the general public, civil society organisations and academia. Ideas and perspectives shared at these events have fed into the Governing Council’s deliberations.

The Governing Council of the European Central Bank (ECB) has today, on 8 July, published its new monetary policy strategy, which it has set out in a monetary policy strategy statement.

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Latvia's civil society involved in European-level discussion on monetary policy future

A discussion "My opinion for the future economy" will be held on 5 November with active participation of Latvia's civil society – representatives of the leading non-governmental organisations. The event has been organised by Latvijas Banka in cooperation with the "Civic Society – Latvia" association to hear the views of non-governmental organisations about the future of the euro area's monetary policy.

This discussion is part of the listening events organised across the euro area within the framework of the strategy review launched by the European Central Bank and seeking the views and recommendations on how to make the euro area's monetary policy more open, modern and better fit for the needs of the economy and the society. The aim of the process is to hear opinions from across Europe, including those from citizens, academics, Members of the European Parliament and civil society organisations.

On euro area monetary policy strategy review

The public mandate of the euro area central banks tasks them with defining the monetary policy so that (along with the government policies in the fields of budget, investment and sectoral reforms) it would serve as a tool for regulating the economic activity by either stimulating or limiting money supply. Currently, a new monetary policy strategy for our currency, the euro, is underway.

This monetary policy strategy is effectively affecting each user of money, as it defines the monetary policy decision-making framework. It specifies the monetary policy objectives, the central bank tools for attaining these objectives as well as the indicators to be considered in decision-making. Therefore, the ECB and the national central banks are seeking the ways to hear the views of the general public on those issues.

On the discussion process

During the discussion, all the participants will have an opportunity to share their experience and express their views as to the impact of the economic and financial developments on a personal and organisation level, including on the represented society group. This would also cover the effects of the crisis caused by the COVID-19 pandemic. The results of the discussion, ideas and recommendations concerning the future of the economy will be fed into the monetary policy strategy of the ECB and Eurosystem reviewed by the management of the euro area central banks this autumn and in the first half of 2021.

The following organisations have confirmed their participation in the discussion: organisation Pilsēta cilvēkiem (City for People), Centrs MARTA, European Movement – Latvia, European Latvian Association, DOTS Foundation, Kurzeme NGO centre, National Youth Council of Latvia, Latvian Rural Forum, Latvian Platform for Development Cooperation, Latvian Samaritan Association, Delna (TI Latvia), Green Liberty, Farmers' Parliament, Riga Active Seniors Alliance, Latvian Small and Medium Enterprises Association, Free Trade Union Confederation of Latvia, Latvian Chamber of Commerce and Industry and Latvian Association of Local and Regional Governments.

Organisers' views

"Civil society is effectively identifying the needs of various social groups, including socially vulnerable groups, and it can respond to those needs much quicker than public administration. Civil society is also an important driver of inclusive growth, increasing the social capital and generating considerable economic value, playing an important social, economic and political role. It also contributes to the economy by attracting foreign financing, it promotes employment, ensures tax payments to the government budget and engages in volunteering, which is also a contribution to GDP growth.

Therefore, the development of the future monetary strategy should also involve a partnership with civil society. This is also consistent with the Parliament's declaration added to Latvia's National Development Plan for 2021–2027, establishing an equal approach to dialogue with the civil society and social dialogue across all stages of the decision-making process," says Kristīne Zonberga, Director of Civic Alliance – Latvia.

"Latvijas Banka is a modern and open institution, contributing to economic growth and improvement of public welfare. This can be achieved through cooperation with other economic operators and through hearing the needs of the society. Monetary policy will be more effective and better targeted if people understand what the central bank is doing, what its objectives and tools are. And vice versa: monetary policy will be much more effective if the central bank is aware of what is important to people, businesses and society at large, what is expected of the economic policymakers. Therefore, in addition to explaining monetary policy issues, we also listen to the society.

We are holding a discussion in Latvia, within the framework of the ongoing euro area's monetary policy strategy review, where the role of Latvijas Banka will mostly be that of a listener learning what the civil society needs and what the latest developments in the leading non-governmental organisations are. Economic policy decisions can be effective, timely and well-grounded only if they take account of the views of the society. This is the best way of strengthening the public good provided by Latvijas Banka," says Mārtiņš Kazāks, Governor of Latvijas Banka.

All stakeholders had an opportunity to express their views about the euro area's monetary policy issues directly by filling in the questionnaire published on the ECB's website (https://www.ecb.europa.eu/home/search/review/html/form.lv.html).