On Thursday 11 January, the European Commissioner for the Economy, Paolo Gentiloni, once again spoke out in favour of the introduction of “common tools” to enable the European Union and its Member States to meet the enormous investment needs in the political priorities it has set itself, once the Next Generation EU Recovery Plan has been finalised in 2026.
I am always “a little scared” when it comes to putting a figure on the annual need for additional investment in the climate and digital transitions, to the tune of around “€650 billion” for the public and private sectors, said Mr Gentiloni during a budgetary dialogue with the European Parliament’s Committee on Economic and Monetary Affairs.
Admittedly, we currently have a lot of money at our disposal thanks to Next Generation EU, but the Recovery Plan is a “one-off”, which is why it is important to start a discussion on the post-2026 period. “We certainly need new common tools for common goals”, he added. And, in his view, the STEP platform for the development of strategic technologies could be seen as “a foretaste” of what needs to be done (see EUROPE 13325/4).
In response to a question from Margarida Marques (S&D, Portuguese), Mr Gentiloni felt that this discussion on the EU’s financial needs should include the prospect of enlargement, which will increase needs, with the accession of countries that will be net beneficiaries of the EU budget. In his view, this issue will be one of the major topics of discussion in the EU’s next legislative cycle.
The European College of Commissioners held a seminar on Friday 12 January at which it discussed ways of boosting European competitiveness, in the presence of former Italian Prime Minister Mario Draghi, and also the financing of economic transition.
The Vice-President of the European Commission, Valdis Dombrovskis, has remained cautious in this debate, which will only really take off after the European elections. In his view, the recommendations on national budgetary policies for 2024 take account of the need to increase investment, with all Member States playing their part in this area, in particular by mobilising financial assistance from the European Recovery Plan.
At the end of February, the Commission will present external studies on the mid-term results of Next Generation EU.
Stability and Growth Pact. On the reform of the Stability and Growth Pact, Mr Dombrovskis and Mr Gentiloni called for an agreement between the European Parliament and the EU Council before the end of the legislative cycle (see EUROPE 13322/12). The European Commissioner for the Economy has indicated that the entry into force of the future rules could be one of the topics for discussion in the interinstitutional negotiations due to begin on Tuesday 23 January.
The Commission is working on the assumption that the revised Stability and Growth Pact will apply from 2025, which would be the starting point for multi-annual macro-budget programmes. This means that the new procedures will be in place by the start of the 2025 ‘European Semester’ exercise in November.
“I think it’s possible, but it’s not obvious”, said Mr Gentiloni.
Nevertheless, in June the Commission will initiate excessive deficit procedures on the basis of the official figures for 2023 and under the current Stability and Growth Pact, after the lifting, at the end of 2023, of its general escape clause in place since the outbreak of the Covid-19 pandemic. According to Mr Gentiloni, these procedures should involve “eight to nine Member States”.
The EU countries whose public deficit exceeds 3% of GDP are: Spain (-4.1% of national GDP), France (-4.8%), Belgium (-4.9%), Malta (-5.1%), Italy (-5.3%), Slovakia (-5.7%), Hungary and Poland (both -5.8%) and Romania (-6.3%). (Original version in French by Mathieu Bion)