Economic and Financial Affairs

At the Euro Summit in December 2020, leaders tasked the Eurogroup with preparing, on a consensual basis, a stepwise and time-bound work plan on all outstanding elements needed to complete the banking union. Leaders underlined this mandate once again at their informal meeting in Versailles on 10-11 March 2022. During an ECOFIN meeting on 3 May, ministers focused on the economic recovery in Europe and exchanged views on the Council implementing decisions approving national recovery and resilience plans for Bulgaria and Sweden. Bulgaria’s recovery and resilience plan consists of €6.3 billion in grants while Sweden’s consists of €3.3 billion in grants. As provided in the RRF regulation, at least 37% of expenditure should be dedicated to climate and at least 20% to digital targets. Apart from these two areas, investments and reforms under the facility will also focus on: smart, sustainable and inclusive growth; social and territorial cohesion; health, and economic, social and institutional resilience; and policies for the next generation.

For over 20 years, the Forum has gathered high-level European and international policymakers, academics, civil society and business leaders to identify key challenges and debate policy priorities for the European economy. To mark 2022 as the European Year of Youth, the Forum will shine a light on what the economy of the next generation should look like. Award-winning young economists will join high-level speakers from across the world to discuss new ideas on how we can build a fair, green and digital economy for the future. Participants at this year’s Forum will include Executive Vice-President Valdis Dombrovskis, Commissioner Paolo Gentiloni, Commissioner Nicolas Schmit, Sigrid Kaag, Deputy Prime Minister, Minister of Finance, the Netherlands, Teresa Ribera, Third Vice-President, Minister for Ecological Transition and Demographic Challenge, Spain and Gita Gopinath, First Deputy Managing Director, International Monetary Fund (IMF) and many more. Further details on how to register and the programme are available at the link below.

Spain's comprehensive recovery and resilience plan amounts to €69.5 billion in grants. RRF payments are performance-based and contingent upon Spain completing the investments and reforms outlined in its Recovery and Resilience Plan. Spain's second payment request relates to the 40 milestones and targets set out in the Council Implementing Decision, covering several reforms and investments in the areas of green and equitable transition, labour market, pensions, regulated professions, digital connectivity and research. Among the areas covered are health care, education, support for vulnerable groups, entrepreneurship and micro-enterprises, prevention of tax evasion, and green taxation, as well as efficient and sustainable public expenditure. The Commission now has two months to assess the request. It will then forward its preliminary assessment of Spain's compliance with the milestones and targets required for this payment to the Council's Economic and Financial Committee.

Slovakia has sent a request to the Commission for a disbursement of €398.7 million in non-repayable financial support (net of pre-financing). Slovakia's overall recovery and resilience plan is being financed by €6.3 billion in grants. Slovakia's payments under the RRF are performance-based and contingent upon Slovakia implementing the investments and reforms outlined in its recovery and resilience plan. Slovakia's first payment request relates to 14 milestones covering reforms in the areas of the judicial system, higher education and R&D, fiscal framework, energy system, sustainable mobility, anti-corruption, digitalisation of the public sector and the audit and control system linked to the Recovery and Resilience Facility. The Commission now has two months to assess the request. It will then send its preliminary assessment of Slovakia's fulfilment of the milestones and targets required for this payment to the Council's Economic and Financial Committee (EFC).

Real Economy also speaks to the European Commission’s Executive Vice-President Valdis Dombrovskis and the IMF’s Deputy Managing Director Gita Gopinath about the economic fallout of the Russian military aggression against Ukraine. Executive Vice-President Valdis Dombrovskis notes that stopping the war in Ukraine “is an aim which we must pursue on its own right. But it's also clear that the faster we stop the war, the better it allows also economy to recover.” He urges Member States to put the financing available through the Recovery and Resilience Facility to good use. Executive Vice-President Dombrovskis also emphasises that “we must move away from our dependency on Russia’s fossil fuels” and that doing so can help Europe to reach its twin climate goals of 55% reduction by 2030 and climate neutrality by 2050. The BEF, to be held on 17 May, has been running for over 20 years and, as 2022 is the European Year of Youth, this year it will address the theme “The future is now: which economy for the next generation?”. To answer that question, Real Economy spoke with some young economists and politicians who will be present at this year’s BEF.