On Thursday 9 November, the finance ministers of the euro area countries will review their national budgetary policies against a macroeconomic backdrop of slowing growth and falling inflation.
With the macroeconomic situation consistent since the summer, the political message remains: the euro area economy is “resilient” and, even if the Eurogroup is aware that “clouds are gathering”, there is “no reason to expect a prolonged recession”, said a European source on Tuesday 7 November.
On Wednesday, the European Commission will give an overview of its autumn economic forecasts, due on Wednesday 15 November, as well as the draft national budget plans for 2024, which will be the subject of an opinion due on Tuesday 21 November, followed by a statement by the Eurogroup on Thursday 7 December. Only then will it be possible to get a clearer picture of how Member States have complied with the Eurogroup’s guidelines to end untargeted emergency budget measures to tackle the energy crisis, even if, according to this source, “some progress” has been made.
The ministers will also discuss competitiveness and potential measures to strengthen it. This discussion will have no operational conclusion, the idea being to raise the ministers’ awareness in the run-up to the ‘Draghi’ report on competitiveness, expected next spring.
The Eurogroup will take stock of the completion of the banking union and, in particular, the ongoing negotiations on the ‘CMDI’ proposal aimed at strengthening the management of a banking crisis (see EUROPE 13183/2). The chairmen of the ‘Single Supervisory Mechanism’ (SSM), Andrea Enria, and the ‘Single Resolution Board’ (SRB), Dominique Laboureix, will take part in these discussions. By the end of 2023, the ‘Single Resolution Fund’ (SRF) will be fully operational and the banks concerned will have raised the ‘MREL’ capital necessary to guarantee their resolvability in the event of default. This will be a good time to discuss the future, the European source said, bearing in mind that Italy has still not ratified the reform of the European Stability Mechanism, the euro area’s permanent rescue fund.
Finally, the ministers will discuss with two representatives of institutional investors how to deepen the capital markets union in the long term (see EUROPE 13279/10). The aim is to present operational recommendations in the spring with the next European legislative cycle in mind. (Original version in French by Mathieu Bion)