The economic situation that emerges after the Russian invasion of Ukraine and the key macroeconomic developments that affect the fiscal planning for 2023 is the main topic of discussion of the Eurogroup starting today at 4 pm (Greek time) in Brussels.
Eurozone finance ministers will look at the macroeconomic situation characterized by a steady rise in inflation due to rising energy prices and high levels of uncertainty caused by the Russian invasion of Ukraine.
According to a European official, the risk of “stagnant inflation” does not exist, mainly because the European economy continues to grow, albeit at a slower pace. At the same time, it is important for finance ministers to adjust and plan fiscal policy for 2023, especially in the wake of geopolitical developments and the impact of sanctions against Russia on the European economy, in order to ensure economic recovery in the eurozone.
It is also recalled that the European Commission does not rule out the possibility of postponing the deactivation of the general escape clause of the Stability and Growth Pact until 2023, pending its proposals, possibly in May.
In addition, the Eurogroup will examine the 13th report of enhanced supervision of Greece. According to a European official, the report noted progress in implementing reforms, in particular in the areas of public administration, the administrative reorganization of the Single Pension Fund, the licensing of investments in the agreed areas, and progress in the field of digitization. The same official noted that by the end of June, it should be determined what kind of supervision will exist for Greece, after four years of close fiscal monitoring.
Another issue that will concern finance ministers is the process that will lead to the appointment of Klaus Regling’s successor as head of the European Stability Mechanism (ESM). Klaus Regling’s second term ends in October and the succession process will begin in May.
The Eurogroup will then meet in its comprehensive format (27 EU finance ministers) to complete the banking union, which is a priority for Eurogroup President Pascal Donahue. Some of the outstanding issues are the introduction of a European deposit guarantee and dealing with banks’ exposure to government risks
The issue of banking union will also be discussed by European leaders at the European Council on 24 and 25 March.
SOURCE: ΑΠΕ-ΜΠΕ
Source: Capital
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