The Economic and Social Council (CES) has expressed its concerns about the new European fiscal rules that were approved at the beginning of the year. According to the council, these rules do not fully address the challenges faced by the previous system, as they remain complex, procyclical, and lack protection for investments. To address these shortcomings, a report released by the CES has recommended several measures such as achieving Banking Union, deepening financial integration with Capital Market Union, defining an industrial policy and issuing joint public debt (eurobonds) to strengthen EU’s resources system.
The CES emphasizes the need for a new recovery fund to support technological and green investments in Europe. The report also reflects on the new fiscal rules which aim to limit annual public deficits to 3% of GDP and keep public debt below 60%. The CES president, Antón Costas, believes that Europe must decide whether to adopt a rigid or compassionate approach within these fiscal rules especially in light of upcoming European Parliament elections.
The council highlights the importance of reforming European mechanisms with budgetary capacity, reinforcing investment mechanisms at the European level, and complementing national fiscal policies to address current macroeconomic challenges. The report also stresses the need to balance new fiscal framework with monetary policy and complete Banking Union to ensure financial stability and economic resilience in EU.
Furthermore, the CES recommends deepening financial integration to advance Capital Market Union and mobilize private capital for innovation and investments. The report also calls for defining a common industrial policy to enhance EU’s competitiveness internationally while promoting economic activity while ensuring cohesion and territorial linkages. Additionally, CES advocates incorporating European human capital development programs and addressing child poverty to achieve sustainable growth economically while improving social wellbeing.
In conclusion, CES report urges European policymakers