Is there a European Economic Spring?

Is there a European Economic Spring?

The first signs of economic recovery must be supported in order to continue progress towards strong and sustainable growth and towards more employment.

I was in Washington last week, taking part in the spring meetings of the IMF, and the G7 and G20 ministerial meetings. I delivered a clear message on behalf of the European Commission: the first signs of economic recovery must be supported in order to continue progress towards strong and sustainable growth and towards more employment. My conviction is that we must collectively take forward a balanced mix of reforms, investment, smart fiscal policies, and fair taxation. And my signal for Europe is that the Juncker Commission is addressing these challenges with renewed strength and commitment.

As I outlined at the last G20 ministerial meeting in Istanbul in early February, many challenges remain, in view of moderate and uneven global economic growth. It would be a political and economic error to believe that recovery is an external factor, and to welcome passively the improvement in the economic outlook. Without action, the only outcome would be stagnation. There is no point in using bandages to hide the remaining scars of the crisis: we must address definitively our weaknesses and move forward.

The current economic upturn in Europe must be supported by strong and consistent measures.

I want to be clear: the point is not to be too optimistic, nor unjustly pessimistic but simply realistic. The current economic upturn in Europe must be supported by strong and consistent measures. We need to pursue the path of structural reforms for growth and jobs, which are essential to secure the future and are inseparable from sound public finances. This approach defines the actions and decisions of the Juncker Commission, within which I want to carry a reformist dynamic. It is this requirement that guides our discussions with Greece and with all Member States. The implementation of ambitious reforms – in particular in labour, services and product markets – is essential to unlock our growth potential and to strengthen the competitiveness and productivity of our economies.

In Europe and in the euro area, our last Winter Economic Forecast showed a slight acceleration of the recovery. This trend is supported by favourable external factors — the drop in oil prices, the depreciation of the euro and the action taken by the European Central Bank, in the context of very low inflation.

I have every reason to believe that growth will be much stronger this year than last year. We have to ensure that this trend will continue in the coming months, towards sustainable growth in Europe.

Is there a European Economic Spring? Do these positive signs of recovery start a new chapter in Europe? The Commission will publish its Spring Economic Forecast on May 5, with a comprehensive analysis of the prospects for recovery in the euro area and the European Union. I have every reason to believe that growth will be much stronger this year than last year. We have to ensure that this trend will continue in the coming months, towards sustainable growth in Europe. The time of recovery must give way to a new era where Europe stands firmly on its own two feet, and where each Member State is an actor in our shared destiny. This is an opportunity that we must seize.

I like this Europe of results, supporting economic and social progress. I work towards this successful Europe every single day. I am convinced that our concerted action is only really useful if it produces measurable outcomes for citizens, particularly in terms of purchasing power and jobs. Our decisions actually make sense only if they respond to the concerns and doubts of European citizens, recreating hope and confidence.

On this last point, I note the recent positive trends published in the EU Employment and Social Situation Quarterly Review earlier this month: the economic situation is gradually improving in Europe, with a steady decline of unemployment – in particular youth unemployment and long-term unemployment. However, I do not want to wallow in any self-congratulation, not in a Union with more than 23.8 million unemployed, and where youth unemployment remains far too high at over 21 %. No politician can be satisfied with these results: we need to provide adequate responses to create more stable and sustainable jobs in Europe.

The Juncker Commission is fully aware of its responsibility to make a positive difference for jobs and growth in Europe.

The Juncker Commission is fully aware of its responsibility to make a positive difference for jobs and growth in Europe. And the Commission is ready — I am ready – to play its full role in this sense, by acting on both the supply and the demand side, working closely with Member States and with international institutions. We have laid a foundation stone with our investment plan for Europe which will deliver at least 315 billion euros in extra investment over the next three years. The European Fund for Strategic Investments is on schedule to become operational in mid-2015, in cooperation with the European Investment Bank. This investment plan is perfectly in line with G20 priorities on the sources and the quality of investment and the support to small and medium-sized enterprises. I know that our partners have a strong interest in our investment plan, and I stressed in Washington the existing synergies between our agenda and G20 agenda.

Support for investment, renewed commitment to further structural reforms and sound fiscal policies are the three supporting pillars of our economic policy.

Support for investment, renewed commitment to further structural reforms and sound fiscal policies are the three supporting pillars of our economic policy. These pillars are inextricably linked to progress on taxation rules, through greater fairness, efficiency and transparency — with a shared approach within the G20, notably in the determined fight against tax fraud and evasion, and against the erosion of tax bases. These coordinated actions are necessary to progress together towards a stronger Europe in a more robust global economy. These are the messages I passed in Washington last week and to my interlocutors in Brussels this week; because this is how we will achieve a real economic spring in Europe.

 La version française de ce billet de blog peut être consultée ici : http://www.pierremoscovici.fr/2015/04/20/y-a-t-il-un-printemps-economique-europeen/