Monday , April 19 2021
Home / Tag Archives: EU budget

Tag Archives: EU budget

The post-coronavirus fiscal policy questions Europe must answer

Europe’s policymakers will have to take a series of decisions in the months ahead, in order to reinstate, and possibly reform, the bloc’s fiscal rulebook. By: Thomas Wieser Date: February 3, 2021 Topic: European Macroeconomics & Governance National fiscal policy has played a vital role in mitigating the socio-economic fallout from the pandemic and the associated containment measures. In the European Union, more space for national fiscal policy was given by the March 2020...

Read More »

Next Generation EU payments across countries and years

How much cake does everyone actually get and at what speed? This blogpost estimates the yearly Next Generation EU (NGEU) payments to each EU country at current prices in euros and as a share of GNI. By: Zsolt Darvas Date: November 12, 2020 Topic: European Macroeconomics & Governance The Special European Council of July 2020 defined the total amount of Next Generation EU (NGEU) commitments at 2018 prices. Existing estimates, including my earlier ones, allocated these 2018 price...

Read More »

European Union recovery funds: strings attached, but not tied up in knots

Ensuring effective recovery spending is a high-stakes challenge for the European Union, with the potential for derailment because of fuzzy objectives and overloaded procedures. The EU should work with member countries to identify limited policies that will maximise the impact of EU investment, while accounting for spillovers. By: Jean Pisani-Ferry Date: October 27, 2020 Topic: European Macroeconomics & Governance The European Union’s plan for aiding recovery in member states...

Read More »

The European climate law needs a strong just transition fund

To deliver on the goals of the European climate law, the European Union needs finally to get coal out of its energy mix: the EU should quicken the pace of decarbonisation whilst delivering on its goal of social inclusion. The European Parliament will vote this week (7 October) on the Commission’s proposal for a European climate law, which would make binding a goal for the European Union of climate neutrality by 2050 and an intermediate emissions reduction target of at least 55% by 2030,...

Read More »

Europe’s recovery gamble

Next Generation EU, was rightly hailed as a major breakthrough: never before had the EU borrowed to finance expenditures, let alone transfers to member states. But the programme and its Recovery and Resilience Facility amount to a high-risk gamble. By: Jean Pisani-Ferry Date: September 25, 2020 Topic: Finance & Financial Regulation This opinion post was originally published in Project Syndicate. To help their pandemic-hit economies recover, European Union leaders agreed in...

Read More »

Redefining European Union green bonds: from greening projects to greening policies

European Union green bonds, as promised by European Commission president Ursula von der Leyen, might be better linked to the bloc's achievement of its climate goals, rather than project-by-project green criteria. In her first State of the Union speech (16 September), European Commission President Ursula von der Leyen set a target of raising through green bonds 30% of the up to €750 billion that will be borrowed under the Next Generation EU recovery fund. Such large-scale EU green bonds...

Read More »

Financing the European Union: New Context, New Responses

With the European Union for the first time taking on debt to help finance the economic recovery from the coronavirus, new resources are needed to fund the EU budget. Various ideas have been floated – including a digital tax and a financial transactions tax – but the most appropriate new resource would be revenues from the EU emissions trading system, which could provide enough funding to repay the EU's coronavirus borrowing. This Policy Contribution is an edited and abridged version of a...

Read More »

The EU’s recovery fund proposals: crisis relief with massive redistribution

Poorer European Union countries and those hardest hit economically by the COVID-19 crisis could obtain up to 15% of their GNI in grants and guarantees from the EU’s proposed recovery instruments. Yet the proposal would represent a net benefit for all EU countries, even if there is only a small positive economic impact over the long-term. The proposed very long-maturity loans would lead to non-negligible benefits, exceeding 1% of GDP for some countries. When European leaders convene this...

Read More »

Three-quarters of Next Generation EU payments will have to wait until 2023

Because of hurdles in designing, approving and implementing European Union programmes, less than a quarter of the €438 billion in grants planned under the new EU recovery instruments is expected to be spent in the next two and a half years, when recovery needs will be greatest. Well-functioning financial markets can help bridge the gap between urgent spending needs and late-arriving EU disbursements, but more effort is needed to frontload EU payments. The falling government bond yields of...

Read More »

An uncompromising budget

Apart from decisive European Central Bank measures, the EU-wide response to the COVID crisis had been rather weak until the Commission put on the table a drastically new proposal: the creation of a new recovery facility, ‘Next Generation EU’, that would borrow money in the name of the EU to finance EU-wide expenditures. The changes to the proposed standard seven-year budget that primarily focuses on long-term structural issues are however generally small, and funding reductions are...

Read More »