Editor's note

International Internet Magazine. Baltic States news & analytics Tuesday, 26.03.2019, 15:08

Controlling the EU states’ economic growth

Eugene Eteris, BC, Copenhagen/Riga, 12.03.2018.Print version

In the Semester’s Winter-2018, the European Commission has shown progress in implementing country-specific recommendations and in assessment of possible financial and economic imbalances in the EU states’ economic and social development. The Baltic States’ situation seems quite good.

European economy is showing positive economic growth with an improved labour market and social situation. This reflects the reforms undertaken by most EU states in recent years and provides a window of opportunity to further strengthen states’ economies resilience. However, recovery still depends on structural reforms, social wellbeing and European path to convergence. Thus, the Baltic States should use this momentum to further strengthening the growth foundations of their economies. To EU provides numerous funds to support the structural reforms during 2018 (see an example below).


The Winter-18 Semester package is part of the annual cycle of policy coordination at EU level, the so-called European Semester. It follows the publication in November of the 2018 Annual Growth Survey and the euro area recommendation, which set the priorities for the year ahead at European level. It now shifts the attention to the national dimension of the European Semester.

It is based on the latest data from the Commission's Winter Interim 2018 Economic Forecast and it builds on the analyses and recommendations of the European Semester Autumn Package 2017. The Country Reports provide the background on which the EY states shall develop their national programmes by mid-April; the Commission will review Country-Specific Recommendations later in spring 2018.

On autumn package see: http://europa.eu/rapid/press-release_IP-17-4681_en.htm  

Winter-28 country reports for all EU states except Greece (the latter is under a stability support programme) provide the annual analysis by Commission staff on the economic and social situation in the EU states, including progress made in implementing Country-Specific Recommendations over the years. This analysis builds on intensive dialogue at technical and political level with the member states, as part of the European Semester of policy coordination.  

For 12 EU states selected in November 2017 for an in-depth review, the Country Reports include an assessment of possible macroeconomic imbalances and the package provides an update of the categorisation of countries under the so-called Macroeconomic Imbalances Procedure.

For the first time, the Country Reports put a special emphasis on mainstreaming the priorities of the European Pillar of Social Rights, proclaimed in November 2017.

A specific focus is put in 2018 on analysing skills challenges and how social safety nets operate at national level. Data from the Social Scoreboard are also used to keep track of employment and social performances.

This European Semester 2018 winter package follows the publication in November of the 2018 Annual Growth Survey and the recommendations on the economic policy in the euro area, which set the priorities for the next year. It now shifts the focus to the national dimension of the Semester and requires the EU states to develop their annual national programmes by mid-April. Together with the Country Reports, the national programmes will be the basis for the Commission's proposals for the next round of Country-Specific Recommendations in May 2018.

Commissioners’ opinion on winter-18 package

Vice-President Valdis Dombrovskis, responsible for the Euro and Social Dialogue, also in charge of Financial Stability, Financial Services and Capital Markets Union: “Strong economies are those that keep addressing their weaknesses, even when times are good. Now that Europe's economy is growing at its fastest pace for a decade, this is precisely what our strategy should be, both at EU and national level”.

Commissioner Pierre Moscovici, responsible for Economic and Financial Affairs, Taxation and Customs: “Eleven EU countries are still experiencing macroeconomic imbalances, which makes them vulnerable in case of shocks. The European Commission notes that these imbalances are being corrected thanks to ongoing reforms and economic recovery, making Europe stronger. The number of countries under this procedure has been falling since the crisis and today such states as Bulgaria, France, Portugal and Slovenia witness positive changes. More efforts are needed in all countries; for millions of Europeans, life remains a daily struggle, which is why all governments must do more to tackle inequality, unemployment and job insecurity”.

Commissioner Marianne Thyssen, in charge of Employment, Social Affairs, Skills and Labour Mobility: "With the proclamation of the European Pillar of Social Rights, we have put investing in skills, reducing inequalities, social fairness and inclusive growth on top of the agenda. We now need to keep track of the performance of the member states on the principles and rights included in the Pillar, to make them a reality on the ground.”

Progress in Country-Specific Recommendations and assistance to reforms

Every year, the Country Reports assess the EU states' progress in tackling their main economic and social challenges and in implementing past Country-Specific Recommendations (CSRs). Looking at progress over the years, the states achieved at least "some progress" with regard to more than two-thirds of the recommendations.

Reform implementation has been solid in some key areas. Since the outset of the European Semester in 2011, the EU states have made most progress in financial services and in fiscal policy and fiscal governance. Significant progress has also been made in addressing access to finance, in employment protection legislation and frameworks for labour contracts; policy highlights for all EU states are included in the Country Reports.

The Commission adopted the 2018 Work Programme for the Structural Reforms Support Programme (SRSP) that will provide support to the EU states to carry out reforms, especially those prioritised in the Country-Specific Recommendations. For example, in 2018, more than 140 projects will be supported in 24 states. On support for structural reforms see:

Regulation (EU) No 2017/825 of the European Parliament and of the Council of 17 May 2017, on the establishment of the Structural Reform Support Programme and amending Regulations (EU) No 1303/2013 and (EU) No 1305/2013; as well as Annex at:  


For example, the following aspects of legislative, institutional, structural and administrative reform could be 100% financed from the EU sources: = developing national SMEs policy; = environmental protection of coastal areas; = improving central-local regulatory framework; = managing the water sector; = raising awareness on energy management, including on how to encourage businesses to implement energy audits; = developing tourism destinations; and = defining and implementing appropriate processes and measures for waste collection.

See: Annex’s item 1.1.3. “Direct grants to support structural reforms in the area of growth, business environment and sectoral issues” (p.23).

Addressing macroeconomic imbalances

In November 2017, the Commission launched in-depth reviews for 12 EU states to analyse whether they were experiencing macroeconomic imbalances and to assess the gravity of these imbalances. After winter’s “examination”, the Commission has concluded that 11 out of the 12 states are still facing either imbalances (8) or excessive imbalances (3). The summary of the in-depth reviews outcome is as follows:

·         Croatia, Cyprus and Italy are experiencing excessive economic imbalances;

Bulgaria, France, Germany, Ireland, the Netherlands, Portugal, Spain and Sweden are experiencing economic imbalances (for Bulgaria, France and Portugal this is de-escalation from excessive imbalances in 2017). For Bulgaria and Portugal the Commission underlined that further efforts remain necessary to achieve a sustainable correction of the imbalances.

·         Slovenia is no longer experiencing economic imbalances.

Social dimension of the European Semester

The social dimension of the European Semester has been further enriched in 2018 according to main priorities of the European Pillar of Social Rights adopted at the end of 2017.

The Country Reports also make use of the data gathered via the Social Scoreboard to keep track of employment and social performances. Situations and priorities naturally vary, and the analysis takes account of this diversity. Areas of particular concerns in some Member States include the provision of adequate skills, persistent gender employment gap, high labour market segmentation and the risk of in-work poverty, the low impact of social transfers on poverty reduction, sluggish wage growth and ineffective social dialogue.

See more in: https://composite-indicators.jrc.ec.europa.eu/social-scoreboard/


After the Commission's assessment EU states’ situation through Country Reports, the Council will discuss the reports together with the results of the in-depth reviews. The Commission will hold bilateral meetings with the states on their respective reports; besides, the Vice-Presidents and other Commissioners will meet states governmental officials, representatives of national parliaments, social partners, etc. to discuss the report’s findings.

Next, the states will have to include their economic and social policy priorities both in the national reform programmes and in stability and/or convergence programmes (setting out budgetary priorities) by mid-April 2018. Then, the priorities of the 2018 Annual Growth Survey and the recommendation on the economic policy of the euro will be taken into account.

The Commission recommends that national programmes in the EU states will be drawn up with the support of the national parliaments and other social partners, regional, local authorities and civil society organisations.

The Commission will propose a new set of Country-Specific Recommendations in May 2018.

Reference: http://europa.eu/rapid/press-release_IP-18-1341_en.htm?locale=en; Latvian version:



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