07 February 2022

ECON: Economic Dialogue with the European Commission on EU Fiscal Surveillance

Executive Vice-President Dombrovskis and Commissioner Gentiloni have been invited to an EconomicDialogue on the fiscal part of the 2022 European Semester autumn package adopted by the Commission inNovember 2021.

The fiscal elements of the package include the Commission Opinions on euro area 2022
Draft Budgetary Plans, the fiscal policy recommendation for the euro area and some elements of the 2022
Alert Mechanism Report. In March 2020, the general escape clause of the Stability and Growth Pact was
activated and the Commission and the Council are expected to de-activate it as of 2023.
This briefing addresses the following subjects: (1) Economic situation; (2) Surveillance of national fiscal
policies; (3) Surveillance of macroeconomic imbalances (fiscal aspects); (4) Implementationof the Recovery
and Resilience Facility; and (5) Review of the EU economic governance framework.

1 Economic background

Recent economic developments and estimations
According to the latest European Commission
Autumn 2021 Economic Forecast “the EU economy is
projected to keep expanding over the forecast horizon,
achieving a growth rate of 5%, 4.3% and 2.5% in 2021,
2022 and 2023 respectively. Growth rates for the euro
area are projected to be identical to those for the EU in
2021 and 2022, and 2.4% in 2023.This outlook depends
heavily on two factors: the evolution of the COVID-19
pandemic and the pace at which supply adjusts to the
rapid turnaround in demand following the re-opening
of the economy”. The Commission is expected to
publish its Winter 2022 InterimEconomic Forecast in
mid-February.
A the time of the Autumn forecast, the Commission
was projecting that "real GDP in the EU is expected
to converge to the steady growth path the
economy was set to follow before the pandemic
by early 2023” ...

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