Brussels, (EFE) March 2020 with the outbreak of the pandemic and which continued as a result of the war in Ukraine.
In a joint statement, the twenty countries of the common currency point out that, despite the “uncertainty” posed by “geopolitical and energy factors”, the risks that threaten economic growth “appear to be more balanced than previously anticipated”, Inflation is already falling, although it remains at levels “still high by historical standards” and labor markets are resisting “strongly.”
“In light of the economic outlook and in a context of high inflation and tighter financial conditions, we reiterate that a general fiscal stimulus for aggregate demand is not justified,” reads the text in which the headlines of Eurozone Finance point out that this year and next they will adopt “prudent fiscal policies” aimed at guaranteeing debt sustainability in the medium term.
In this way, the Eurogroup endorses the message that the European Commission expressed in its guidelines for the preparation of the 2024 budgets and also includes the idea of accompanying the new phase of adjustments with investments and reforms that “raise potential growth” and allow the block to continue advancing in the green and digital transitions.
“We have asked to protect investments, especially strategic ones, both at the national and European level. And we also call for prudent fiscal policies with the withdrawal of universal energy support measures ”, summed up the Commissioner for the Economy, Paolo Gentiloni, upon his arrival at the meeting.
In this line, the Eurogroup points out that the measures implemented to deal with the escalation of energy prices have a high cost on public finances and that is why it is necessary to move “from universal support to more focused measures with better design and efficiency, and more affordable.
Consequently, and “in the absence of new price increases”, the Twenty undertake to “continue withdrawing energy support measures”, something that will help “reduce public deficits”, as well as “continue protecting the most vulnerable households”. vulnerable and viable companies”.
The Eurogroup statement on the 2024 budgetary policy does not include, however, any reference to the intention of Brussels not to open files this year for excessive deficits to countries whose gap in public accounts exceeds 3% of GDP or whose debt exceeds 60% of GDP.
This issue was a controversial point before the debate at the Eurogroup meeting since countries like Germany and the Netherlands preferred that these procedures be opened from this very spring, which would mean starting the procedure for 16 of the 27 EU countries that would have exceeded 3%, according to the latest Commission forecasts.
On the contrary, the Spanish Vice President and Minister of Economic Affairs, Nadia Calviño, was against opening files this year since this “continues to be an absolutely extraordinary exercise due to the need to mobilize public resources” to respond to the impact of the war. in Ukraine and contain inflation.
While Berlin defends that in 2024 the current rules should be applied again if new ones have not been agreed, Spain advocates a “transitional regime” until the Twenty-seven have agreed to the reform of the Stability and Growth Pact, in line with the position of partners like France or Belgium.
“Are the current rules adequate? No, because we all see that the situation has radically changed (…) New rules are necessary, the sooner we are able to change them, the safer the eurozone will be”, argued the French head of Finance, Bruno Le Maire.