Not all EU countries will recover from the economic losses of 2020 at the same pace, the European Commission said on Monday (22 February), calling for a “strong joint response” from all 27 EU member states.
“The 2020 losses will not be recovered as quickly or at the same pace across the EU and it is therefore essential that the 27 member states work together in a joint and strong European response,” said Johannes Hahn, the EU commissioner for budget and administration.
Although the effects of the pandemic are still being felt across the economy, Hahn said there was “light at the end of the tunnel in the winter forecasts”.
“We expect an overall recovery of the EU economy of 3.7% in 2021 and 3.9% in 2022, which means a return to pre-pandemic GDP levels in 2022 sooner than expected,” he underlined.
Johannes Hahn reiterated the executive’s call for EU member states to quickly ratify the decision creating new “own resources” for the EU budget, which European leaders approved last December, recalling that seven member states have already ratified it.
“We count on the commitment of all member states to move forward as quickly as possible in the interest of all EU citizens,” he added, saying that the Commission can only begin issuing debt after all 27 member states have completed ratification.
Since last year, the EU executive has been in intensive dialogue with all member states to discuss the preparation of their national recovery plans, which are a precondition to tap into the EU’s €750 billion recovery fund.
“This could help ensure that national plans are fully aligned with the objectives,” Hahn said, emphasising the need to avoid undue delays in the disbursement of funds to EU member states.
The Commissioner insisted that the governments of the 27 should consult stakeholders at national level in the preparation of their plans, including with local and regional authorities.
He said the national plans are not only about investments, but also about the necessary reforms corresponding to the recommendations of the European semester.
After the approval of the own resources decision by all member states, the European Commission foresees a volume of debt issuances of €150 to €200 billion annually until the end of 2026.
This means that the EU will be one of the largest issuers in the market on a par with sovereign bond issuers such as France, Italy and Germany, Hahn said.