The President of the European Commission Ursula van der Leyen announced the relaunch of discussions to revise the general framework of the economic governance of the EU. The famous “Maastricht criteria” could be redefined.
In her State of the Union address on September 15, the President of the European Commission, Ursula van der Leyen, announced that the European Commission would relaunch the discussion on the governance review “in the coming weeks”. economic. She clarified that the aim was to reach consensus on the way forward “well before 2023”.
This deadline corresponds to the theoretical end of the suspension of the Stability and Growth Pact, also known as the “Maastricht criteria”, in other words, the obligation for member states to limit their budget deficit to 3% of their gross domestic product (GDP), and their indebtedness to 60% of it.
According to the Eurostat bulletin dated at the end of July, the average debt ratio of the Member States was, at the end of the first quarter of 2021, 100.5% in the euro area and 92.9% overall. of the European Union (EU). As for the budget deficit / GDP ratios, they were 7.4% and 6.8% respectively. These averages mask very strong disparities, between Greece for example, where the debt / GDP ratio is now close to 210%, or France (118%), while it has remained below 60% in the Netherlands, and capped at 28% in Luxembourg.
The idea of this review predates the outbreak of the pandemic and was proposed in September 2019 by the European Fiscal Committee, an advisory body to the Commission, with the aim of optimally adjusting the Stability and Growth Pact. to the reality of different national economies. At the beginning of February 2020, the Commission specified that the discussions prior to this review should involve “all interested parties”, namely the European Parliament, the Council, the European Central Bank, the European Economic and Social Committee, the Committee of the Regions, national governments and parliaments, national central banks, independent budgetary institutions, national productivity councils, social partners, and finally the university.
However, these discussions between the representatives of the 27 were suspended shortly after because of the outbreak of the Covid-19 pandemic, which imposed on the European executive actions deemed more urgent. However, the Budget Committee had had time to develop a basis for negotiation. It proposed in particular to set aside the criterion of the public deficit fixed at 3%, and, instead, to establish an annual expenditure ceiling and to define a “favorable orientation to growth oriented towards productive investment”.