PARIS (Reuters) - The euro zone's most pressing reform is to set up a new institution with a finance minister to coordinate national fiscal and economic policies, ECB governing council member Francois Villeroy de Galhau said on Monday.
Pointing to studies suggesting that shoddy coordination has cost the currency bloc 2-5 percent of economic output in recent years, Villeroy said the euro zone had two years to change and that Britain's referendum on its EU membership was no excuse to stall.
France and Germany have pledged to make proposals on reform of the euro zone before the end of the year, though not before Britain's June 23 referendum on whether to remain or leave the European Union.
Villeroy said the new minister would be tasked with forging a strategy for getting the euro zone onto a path to faster growth and keeping countries on that path.
In a proposal that could weaken the grip of governments on their own national agenda, the minister would propose reforms and policy stances for countries that would be approved by a simple majority among euro zone finance ministers.
The minister would also be in charge of a proposed convergence fund that could be used to finance infrastructure or refugee settlement and which could be a precursor to a joint euro zone budget further down the line.
"My view is that we should leave the door open to further integration for countries that are willing and ready to consider it," Villeroy said at a conference at the Bank of France where he is also governor.
"Yet the most urgently needed part of EMU (economic and monetary union) reform is to set up a strong institution, led by a euro area finance minister," he added.
Villeroy said the new finance minister could have a term of five years and would both chair the Eurogroup of finance ministers and be a member of the European Commission, thus representing the euro zone on the international stage.
However, he acknowledged the changes would require a new EU treaty, a negotiation process that has never come easily in the past for EU member states.