Commission sets steps for stability, growth and jobs

May 17, 2012

 

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The European Commission has adopted a package of recommendations for budgetary measures and economic reforms to enhance financial stability, boost growth and create employment across the EU. The recommendations are country-specific, taking account of the individual situation of each Member State. The Commission has also issued recommendations for the euro area as a whole, and set out its vision for the EU-level policy action needed to complement the national measures to deliver an ambitious, two-tiered EU growth initiative. It has also presented the conclusions of twelve in-depth reviews in the context of the Macroeconomic Imbalance Procedure and made recommendations to the Council relating to the Excessive Deficit Procedure.

President Barroso said: “Today the Commission has taken important decisions that set out the further action that needs to be taken both at national level by each of our Member States and at the EU level to enhance our competitiveness, boost growth and jobs, and to strengthen decisively our economic and monetary union. They reflect the Commission’s vital role at the heart of Europe’s economic government. Our recommendations are tailored for each Member State, but form part of a coherent approach to rebalancing the European economy. We have made good progress: public finances are starting to improve and imbalances are beginning to be unwound. The direction is clear. We now need to redouble our efforts, at both the national and European levels, to move faster and further.”

A number of key messages emerge from this second set of annual country-specific recommendations. On public finances, Member States are on the whole taking the necessary action to restore sustainability, but in several cases consolidation should be more growth-friendly. Unemployment, and in particular youth unemployment, is a severe problem – and though there is no quick fix, immediate action should be taken to increase productivity and better match skills and training to labour market needs. Many Member States are undertaking major structural reforms, including of their labour markets. These are helping to boost competitiveness and to correct macro-economic imbalances within Europe. Yet much greater action is needed across the EU to unlock our growth potential, create opportunities for business development, and unleash the job-creating potential of the services and energy sectors and the digital economy.

Finally, the Commission has indicated the main steps towards full economic and monetary union, including a banking union; euro area financial supervision and euro-area wide deposit guarantees. This process will need to take into account legal issues such as Treaty and constitutional change, while giving more democratic legitimacy and accountability to further integration moves.