MEPs and members of national parliaments kicked off their two-day yearly gathering on Tuesday, dedicated to discussing EU economic governance.
The Winter 2020 Economic Forecast published today projects that the European economy is set to continue on a path of steady, moderate growth. The euro area has now enjoyed its longest period of sustained growth since the euro was introduced in 1999.
The forecast projects that euro area gross domestic product (GDP) growth will remain stable at 1.2% in 2020 and 2021. For the EU as a whole, growth is forecast to ease marginally to 1.4% in 2020 and 2021, down from 1.5% in 2019.
The European Committee of the Regions welcomes the European Commission’s approach to start the review of the EU’s fiscal rules consulting all stakeholders concerned. The current set of rules has shown its limits especially in stimulating public investment during the financial crisis and the recovery phase. Local and regional authorities are responsible for one third of public expenditure and undertake more than half of public investment. Their investments have still not fully recovered and remain about a quarter below the peak of 2009 from 2.1 of GDP to 1.6% of GDP in 2018, accounting for about EUR 80 billion of missing public investments in 2018 alone.
The Commission today presents a review of the effectiveness of the economic surveillance framework and launches a public debate on its future.
The EU framework for economic surveillance has guided Member States in achieving their economic and fiscal policy objectives. It helped attain closer coordination of economic policies, address macroeconomic imbalances, reduce public deficits and debt levels. It created the conditions for sustainable growth and for achieving the Union’s strategy for growth and jobs. However, some vulnerabilities remain and the fiscal framework has grown increasingly complex, hampering its buy-in.