The euro zone should be represented at the Group of 20 (G20) world major economies and coordinate more closely on economic policies, the chairman of the eurogroup said on Monday.
"The international status of the euro implies external representation. The G7 (goup of seven) is becoming less important, being overshadowed by the G20, and here the eurogroup is not represented," Luxembourg Prime Minister Jean-Claude Juncker told reporters after he was newly re-elected by eurozone finance ministers as their chairman until mid-2012.
Juncker said the European Commission, the European Union's (EU) executive arm, is ready to make a formal proposal for the euro zone's membership at the G20.
Currently, major EU member states, including several eurozone countries such as Germany, France and Italy, are represented in the G20. The EU also has a separate seat.
In a letter to eurozone finance ministers ahead of Monday's meeting, Juncker said a single seat is essential to ensure that the euro zone's interests are fully reflected in international discussions.
Listing four priorities for his new term in the next two and a half years, Juncker said eurozone countries should work out common positions and speak in one voice externally so as to increase the international status of the euro.
He also called for better economic governance and coordination in the single currency club.
"Coordination of economic policy should be enhanced," he said.
Juncker suggested eurozone countries should not only coordinate their fiscal policies, but also on structural reforms.
"Various countries have to agree on exit strategy," he said, referring to a gradual withdrawal of fiscal stimulus when an economic recovery takes hold.
"We will need to concentrate our efforts on structural policies ... linked to respective competitiveness of member states throughout the euro zone," he added.
By strengthening coordination, Juncker said economic surveillance in the euro zone should be broadened in order to phase out macroeconomic imbalances and to identify priorities for its members and the euro zone as a whole.
"We have to apply the stability pact. We have to broaden surveillance in the euro area ... (and) need to focus on gradual phasing out of macroeconomic imbalances," he said.
Juncker proposed that the European Commission should be given the power to issue a warning to a member state whose policies were not in line with what had been agreed.
"If a country moves away from the broad economic guidelines, it should receive a warning from the commission. We should talk firmly and vigorously to the member state involved," he said.
Juncker has headed the informal group of eurozone finance ministers since January 2005, presiding over their monthly meetings which are intended to improve coordination of economic policies within the single currency club.
The previous term for eurogroup chairman are two years and Juncker's latest mandate should expire at the end of 2010, but the EU's Lisbon Treaty, which came into force in December, gives the eurogroup a formal status with a president who serves for two and a half years.
While eurozone finance ministers continue to meet informally, they will now have greater scope to set their own rules on budgets and economic policy.
They can also vote on a unified eurozone position in international financial institutions, such as the International Monetary Fund and G20.
Juncker, 55, is the EU's longest-serving leader. He has been the Prime Minister of Luxembourg since 1995, and is also his country's treasury minister.