On Tuesday 18 February, the European finance ministers will hold an exchange of views on the measures to be taken to boost the European Union’s economic competitiveness.
In particular, they will be basing themselves on the ‘Competitiveness Compass’, unveiled at the end of January by the European Commission (see EUROPE 13568/1), which sets out a series of initiatives to simplify European regulations, in particular financial reporting.
These discussions will take place at various meetings of the Ecofin Council and in different EU Council formats, a European source said on Friday 14 February.
Ukraine. The ministers will hold a further exchange of views on the economic impact of Russia’s invasion of Ukraine, almost three years after the start of the offensive. They will be briefed on the implementation of two EU macroeconomic assistance packages for Ukraine: the Ukraine Facility worth €50 billion over the period 2024-2027 and the EU loan in support of the G7 countries, pledged against the profits from Russian assets held in the EU.
The issue of confiscating these Russian assets will not be on the agenda on Tuesday. Discussions are said to be taking place within other Council formations, according to this source. But some experts do not see such a financing option for Ukraine materialising because of opposition from the ECB, motivated by fears about the credibility of the euro area.
Taxation. In the area of taxation, the Ecofin Council will adopt without debate a revision of the EU’s grey list of countries and jurisdictions that have made commitments in the area of tax cooperation (see EUROPE 13499/21).
According to our information, Costa Rica and Curaçao will be removed from the grey list, while Brunei Darussalam will be included.
The blacklist will reportedly remain unchanged, with eleven jurisdictions: Anguilla, Fiji, Guam, American Virgin Islands, Palau, Panama, Russian Federation, Samoa, Trinidad and Tobago and Vanuatu.
It should be noted that at breakfast, the ministers may raise the issue of tax negotiations within the OECD in light of President Trump’s announcement that the US is withdrawing from the international reform of the corporate minimum tax (see EUROPE 13562/8).
The Council is also expected to adopt the Directive and Implementing Regulation on the Value Added Tax (VAT) exemption electronic certificate. The text met with unanimous political agreement in December (see EUROPE 13542/2). Under this directive, an electronic certificate will replace the current paper certificate used when goods need to be exempt from VAT, for example, because they are imported for embassies, international organisations or the armed forces.
To see the directive, go to https://aeur.eu/f/fia
To see the regulation, go to https://aeur.eu/f/fib
See the invitation letter from Polish Finance Minister Andrzej Domański: https://aeur.eu/f/fjb
Budget. the Ecofin Council will adopt conclusions setting out guidelines for the EU budget in 2026.
Fiscal policy. In terms of budgetary policy, it will approve Hungary’s multiannual budgetary programme, which sets out its four-year trajectory for net public spending (https://data.consilium.europa.eu/doc/document/ST-5894-2025-INIT/en/pdf - see EUROPE 13579/25). It will also adopt a recommendation on the reduction of Hungary’s public deficit, calling on Budapest to bring the deficit below 3% of national GDP by 2026.
As part of the ‘European Semester’ budgetary process, the Council will approve the fiscal and economic policy recommendation for the euro area, which calls for a “slightly restrictive” fiscal stance in 2025 and 2026 (see EUROPE 13578/30).
The issue of making the Stability and Growth Pact more flexible in order to increase investment in the defence sector is not on the agenda for the ministerial meeting (see EUROPE 13572/16). According to this source, the issue will be addressed as part of the ‘White Paper on the future of the defence sector’. Last Friday, at the Munich Security Conference, European Commission President von der Leyen raised the possibility of using the Pact's new 'escape clause', which a Member State could invoke to derogate from European budgetary rules in the event of extraordinary circumstances, in this case the EU's need to invest massively in defense (see EUROPE 13580/6).
The ministers will also adopt conclusions on the 2025 report on the alert mechanism for macroeconomic imbalances presented by the European Commission at the end of 2024 (see EUROPE 13435/1). According to a provisional version of the conclusions, they will take note of the EU institution’s intention to prepare in-depth reviews for nine Member States: Cyprus, Germany, Greece, Hungary, Italy, the Netherlands, Romania, Sweden and Slovakia.
To see the draft Council conclusions, go to https://aeur.eu/f/fie
RRF. The Ecofin Council will adopt, with no debate, a revision of the post-Covid-19 recovery plans for Belgium (https://aeur.eu/f/fgh ) and Latvia (https://aeur.eu/f/fgi ).
To see the draft Council decision and its annex, go to https://aeur.eu/f/fgh
On financial services, the Polish Presidency of the Council will review the progress of legislative proposals. In its 2025 work programme, the Commission intends to withdraw two legislative proposals, the first aimed at introducing an accelerated mechanism for the out-of-court enforcement of guarantees and the second relating to sovereign bond-backed securities (SBBS).
Finally, the ministers will approve the position that the EU countries will defend at the G20 Finance Summit on 26 and 27 February in Cape Town, South Africa. (Original version in Frenchy by Mathieu Bion with Anne Damiani and Bernard Denuit)