To be strong in the global market, the European Union (EU) needs strong internal rules. The informal meeting of EU Economy Ministers (Ecofin) in Santiago de Compostela has meant “a before and after in the relationship with the economies of Latin America and the Caribbean,” said the First Vice President and Minister of Economic Affairs this Saturday. , Nadia Calvino. And the meeting also served to lay the foundations for what will be the new European tax rules that will be applied from 2024. Calviño highlighted that “70% of the text” has already been closed and that the Spanish presidency of the Council of the EU It will now move on to political negotiations with the Member States.
The Vice President of the European Commission and Commissioner for Trade, Valdis Dombrovskis, applauded Spain’s ambition to achieve an agreement: “Completing the pact on fiscal rules is a great challenge, but the Spanish presidency is very committed to complying with the schedule.” , he pointed.
For Brussels, the agreement on the new fiscal rules is “urgent” and Spain has set itself the priority objective of unblocking these negotiations. “All the issues that are outside the essential core are agreed upon,” Calviño stressed. The difficulty lies in achieving a balance that ensures the reduction of debt and deficit of European countries and, at the same time, leaves the necessary space to address the necessary investments in the face of the double green and digital transition.
Germany, the main obstacle
The European Commission’s proposal, in April, opened the door to plans tailored to each country with a mandatory fiscal adjustment of 0.5% for those Member States that present excessive public debt and deficits. This first approach did not please Germany, which asked for a debt cut and a minimum deficit of 1%.
Months later, working on the basis drawn up by Brussels, there has been progress and the Spanish minister sees “a firm commitment on the part of all countries” to reach an agreement by the end of the year. “We must ensure that the specificities of each country are taken into account and, at the same time, create rules that ensure equal treatment between all of them.” For the moment, Spain has committed to preparing a first proposal for the Ecofin on October 17.
In parallel, facing 2024, the community Executive is committed to “fiscal prudence” and coordination with the European Central Bank (ECB). The Spanish vice president agreed that during the pandemic and after the Russian invasion of Ukraine “coordination regarding fiscal and monetary policy was fundamental and is also fundamental now.” The president of the ECB, Christine Lagarde, warned the Twenty-seven of the need to reduce their public debt and withdraw the aid implemented due to the energy crisis, which can contribute to raising inflation.
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