A deadline of September 20 is expected to be given to member states to present their medium-term plansonce the new European fiscal rules come into force, announced today Economy Commissioner Paolo Gentiloni.

Coming to the Council of Finance Ministers of the Eurozone (Eurogroup) where, among other things, the fiscal policy in the eurozone is discussed, P. Gentiloni announced a “hot” summer in terms of work for the financial staffs. “We are heading for a very interesting summer in terms of our fiscal policy coordination,” said the Italian Commissioner. If the revised fiscal rules are approved by the European Parliament next month, they should start to apply as early as 2025, the Economy Commissioner explained. He admitted that “the timescales are very tight” and that this was a “challenge”, but he said most member states agreed that the new rules would start to apply in 2025.

“During the summer we will work intensively, on the medium-term plans, together with the member states,” said the Economy Commissioner, pointing out that the member states will be given a deadline of September 20 to submit their medium-term plans to the Commission. It is noted that in June, the European Commission should provide policy guidelines based on the revised European fiscal rules, so that member states can prepare their multiannual macroeconomic programs for the second half of 2024.

Regarding the fiscal stance of the eurozone countries for 2025, P. Gentiloni recalled that it will be “overall slightly restrictive”, but underlined the need for “flexibility” and “coordination”. In particular, he underlined the need to maintain the balance between stabilizing public finances and maintaining the necessary fiscal space for the necessary investments in defense and in digital and green transition.

Regarding economic growth in 2024, P. Gentiloni said that while we do see inflation declining, “we start this year with very weak economic activity in the EU with the prospect of an acceleration of activity in the 2nd half of the year.” He noted that according to the ECB’s forecasts, real GDP growth was revised down to 0.6% for 2024, while a recovery to 1.5% in 2025 and 1.6% in 2026 is expected, fueled by investment and consumption.

Finally, as regards the deepening of the integration of the European capital and financial markets, for which today the Eurogroup is expected to adopt a joint statement, the Commissioner for Economy praised the efforts made in recent months by the President of the Eurogroup, Pascal Donahue, to create the basis for a road map for the next political cycle. “This is a common ground and at the same time we should first be very committed to implementing what the Commission proposes and be much more ambitious and not limit ourselves to the joint statement we will approve today,” he added.