13 June 2019

BusinessEurope: EU finance ministers must achieve breakthrough on EMU completion

BusinessEurope published its Spring Economic Outlook 2019. While EU finance ministers met in Luxembourg last week, BusinessEurope is underlining the importance of completing the Economic and Monetary Union (EMU) and strengthening long-term economic growth.

Publishing Spring Economic Outlook 2019, BusinessEurope Director General Markus J. Beyrer said: “In particular, we urge ministers to agree on the details of the proposed euro area budgetary instrument for convergence and competitiveness. Such an instrument, which should be developed to combine a commitment to supporting structural reform, with a stabilisation function, whilst limiting moral hazard, could improve the resilience of the EU economy. We call on ministers to demonstrate clear progress on the completion of both, the banking and capital markets unions. In particular, it is important that a clear roadmap is published for the implementation of an EU deposit insurance scheme.”

According to BusinessEurope’s outlook, the recent downturn highlights the fragility of the EU economy:

• EU economic growth fell considerably in the second half of 2018;
• BusinessEurope expects for 2019 GDP growth of 1.6% in the EU and 1.3% in the euro area, considerably lower than its autumn forecast;
• Following tentative signs of a rebound in growth already in Q1 this year, BusinessEurope expects growth to pick up in 2020 to 1.7% in the EU and 1.5% in the euro area.

Risks to the outlook remain on the downside, with the continuing possibility of a damaging, no-deal Brexit and the recent escalation of trade tensions, particularly between the USA and China. These are increasing concerns for EU businesses. BusinessEurope’s outlook also shows that uncertainty over tax levels is increasingly seen as a risk by business, and in turn a dampener on investment plans.

Full press release

Spring Economic Outlook 2019

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