Editor's note

International Internet Magazine. Baltic States news & analytics Wednesday, 22.05.2019, 10:30

Baltic States & the European Semester: positive news

Eugene Eteris, European Studies Faculty, RSU, BC International Editor, Copenhagen, 23.11.2018.Print version

Good news: in the EU Semester’s autumn package for 2019, European Commission has regarded all three Baltic States’ draft budgetary plans as “compliant” with the EU growth strategies.

Commission has set out European economic and social priorities for 2019 and presented its opinions on the member states’ draft budgetary plans. It confirmed a different “level of compliance” between the member states’ development plans and the EU’s stability and growth targets. All three Baltic States’ draft budgetary plans are “compliant” with the EU strategies.

Member states’ budget control

Twice a year –in spring and in autumn- the Commission assesses the member states smart, inclusive and sustainable growth, which shall correspond to their budgetary plans. It also helps in job creation while enhancing the resilience of the member states' economies. At the national level, there is a pressing need to use the current growth momentum to build up fiscal buffers and reduce debt. Investment and structural reforms need to focus even more on boosting productivity and growth potential. These actions will provide the conditions for sustained macro-financial stability and serve EU's long-term competitiveness. This in turn will create the conditions for more and better jobs, greater social fairness and better living standards for citizens.


A lot has been achieved since 2014 but more must be done to support inclusive and sustainable growth and job creation in the EU states.


The 2019 European Semester cycle of economic and social policy coordination witness less dynamic growth in high uncertainty:  there is a pressing need to use the current growth momentum to build up fiscal buffers and reduce debt in the member states. Investment and structural reforms need to focus even more on boosting productivity and growth potential to provide for sustained macro-financial stability and long-term competitiveness.


This autumn’s package is based on the 2018 economic forecast and builds on the priorities set out in President Juncker's 2018 State of the Union address. Thus, growth in the euro area has been 2.4% in 2017, reduced to 2.1% in 2018 before moderating further to 1.9% in 2019 and 1.7% in 2020. The same pattern is expected for the EU-27, with growth forecast at 2.2% in 2018, 2.0% in 2019 and 1.9% in 2020.


References to the autumn forecast at: http://europa.eu/rapid/press-release_IP-18-6254_en.htm.


The state of the Union in:

 https://ec.europa.eu/commission/priorities/state-union-speeches/state-union-2018_en


General reference at: http://europa.eu/rapid/press-release_IP-18-6462_en.htm

Baltic States: compliance with the DBPs

The Commission also reviewed whether the 2019 Draft Budgetary Plans (DBPs) of the 19 euro area member states comply with the Stability and Growth Pact, SGP.


In the so-called preventive arm of the Stability and Growth Pact, SGP: ten states - Germany, Ireland, Greece, Cyprus, Lithuania, Luxembourg, Malta, Netherlands, Austria, and Finland, their plans (DBPs) have been compliant with the SGP in 2019.


For three states – Estonia, Latvia and Slovakia, the DBPs are broadly compliant with the SGP in 2019. For these countries, the plans might result in some deviation from the country's medium-term budgetary objective (MTO) or the adjustment path towards it.


For four states – Belgium, France, Portugal and Slovenia, the DBPs pose a risk of non-compliance with the SGP in 2019. The DBPs of these states might result in a significant deviation from the adjustment paths towards the respective medium-term budgetary objective.

 

Additional web links on European Semester

Memo on the European Semester Autumn Package;

Annual Growth Survey 2019;

Alert Mechanism Report 2019;

Euro area recommendation 2019;

Draft Joint Employment Report 2019

Communication on the 2019 Draft Budgetary Plans of the euro area

2019 Draft Budgetary Plans

Autumn 2018 Economic Forecast.





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