On Monday 20 July, the Council of the European Union formally adopted socio-economic policy recommendations for each Member State and for the euro area as a whole.
This exercise is undertaken every year as part of the ‘European Semester’ budget process. It specific purpose is to provide guidance to Member States as they prepare their draft budget plans for the following year.
Under the EU Recovery Plan currently being negotiated in the European Council (see EUROPE 12532/1), Member States will be required to present national recovery plans in the autumn based on the recommendations provided to them at European level.
There are varying degrees of compliance with the country-level recommendations because they are not legally binding (see EUROPE 12490/12). They generally show little change from the initial proposals submitted by the European Commission in May (see EUROPE 12491/12).
This year's recommendations take into account the freezing of the Stability and Growth Pact to allow Member States to fund the fight against the coronavirus and to support their economies.
At the aggregate euro area level, the Council of the EU is recommending that the Nineteen adopt “a broadly neutral to slightly expansionary fiscal stance” in 2020 and 2021, while also stressing that Member States’ “fiscal responses should be differentiated” with respect to the Covid-19 pandemic.
The country-specific socio-economic policy recommendations for the EU27 and the euro area can be found at: https://bit.ly/2ZL2ecQ (Original version in French by Mathieu Bion)