France moves off EU's deficit list, Romania and Hungary warned
Thyssen - Moscovici - Photo EC
(BRUSSELS) - The EU Commission recommended Wednesday that the excessive deficit procedure be closed for France, and warned Hungary and Romania of the need to act early to correct deviations from their fiscal targets.
Presenting its 2019 European Semester Spring Package, the EU executive set out country-specific economic policy guidance for the EU's Member States for the next 12 to 18 months.
Its report shows Europe's economy growing at its fastest pace in a decade, with record employment, recovering investment and improved public finances.
According to the Commission's 2018 Spring forecast, growth in the next two years will slow slightly but remain robust. The current favourable conditions should be used to make Europe's economies and societies stronger and more resilient.
The country-specific recommendations proposed today build on progress already made in recent years, says the Commission, and aim to capitalise on the positive economic outlook to guide Member States to take further action.
"Today we move a step closer to leaving behind us the legacy of the crisis, as France exits the Excessive Deficit Procedure after nine years," said Pierre Moscovici, Commissioner for Economic and Financial Affairs: "For the first time since the creation of the single currency, all euro area countries will have a deficit below 3% of GDP in 2018."
But "we must ensure that responsibility remains the name of the game in the future too," he added. "That's why we address a strong message to Hungary and Romania that they should take action to this year and next to correct a significant deviation from their fiscal targets. Prevention is better than cure, and the time to prevent serious problems from emerging is now that the economy is strong."
In the country-specific recommendations, the Commission calls on Member States to 'pursue structural reforms that improve the business environment and conditions for investment', specifically through product and service market reforms, supporting innovation, improving small- and medium-sized enterprises' access to finance and fighting corruption.
Countries are also recommended to carry out reforms that prepare their workforces for the future, including future forms of work and increasing digitalisation; reduce income inequalities; and create employment opportunities, for young people in particular.
Memo on the European Semester 2018 Spring Package
Country-specific recommendations 2018
Excessive Deficit Procedure for France