“The maintenance in 2023 of the general escape clause of the Stability and Growth Pact, proposed by the Commission, covers all EU countries”, explained today the Vice President of the Committee on Economy, Vladis Dobrovskis.
W. Dobrowski stressed that the general escape clause does not suspend EU fiscal rules, nor the Stability and Growth Pact. The Commission continues to provide budgetary guidance to Member States and differentiates between high – debt Member States and low – and medium – debt Member States.
“In the case of high debt, including Greece, our guidance is that the increase in current expenditures should be below the potential medium-term economic growth,” he said. Dobrowski, while “for countries with low or medium debt, current spending should not exceed the medium-term increase in spending.”
“Overall, the European Commission’s message is that broad fiscal stimulus for 2023 is not justified and that a country must gradually return to prudent fiscal policy,” he said.
For 2022, the Commission recommends an “expansionary fiscal stance” for the EU as a whole.
For 2023, the Commission recommends “prudent” fiscal policy and “careful planning”, given the “specific nature” of the macroeconomic shock caused by Russia’s invasion of Ukraine and its long-term implications for EU energy security needs. ” “The full and timely implementation of the National Recovery and Sustainability Plans (RRPs) is the key to achieving higher levels of investment,” the Commission said.
In particular, in the spring package for the European Semester 2022, the Commission adopted a report under Article 126 (3) of the EU Treaty, for 18 Member States (Belgium, Bulgaria, Czech Republic, Germany, Greece, Spain, France, Italy, Latvia, Lithuania, Hungary, Malta, Estonia, Austria, Poland, Slovenia, Slovakia and Finland). The purpose of this report is to assess the compliance of Member States with the deficit and debt criteria of the Treaty. For all these Member States except Finland, the report assesses their compliance with the deficit criterion. In the case of Lithuania, Estonia and Poland, the report was drawn up due to a projected deficit in 2022 that exceeded the Treaty 3% of GDP reference value, while the other Member States had a general government deficit in 2021 of more than 3%. of GDP.
The pandemic continues to have a tremendous macroeconomic and fiscal impact which, together with the current geopolitical situation, creates extreme uncertainty, including the planning of a detailed fiscal policy path. Therefore, the Commission does not propose launching new excessive deficit procedures.
The Commission will reassess the budgetary situation of the Member States in autumn 2022. In the spring of 2023, the Commission will assess the relevance of the proposal to launch excessive deficit procedures based on the 2022 outcome data, in particular fiscal recommendations by country.
Finally, the Commission assessed the existence of macroeconomic imbalances.
Seven Member States (Germany, Spain, France, the Netherlands, Portugal, Romania and Sweden) still face imbalances. Three Member States (Greece, Italy and Cyprus) continue to face excessive imbalances.
SOURCE: AMPE
Source: Capital
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.