“Member states will have to walk a narrow path of bringing down debt levels while supporting growth,” Gentiloni said. “Strengthening our competitiveness through investments and structural reforms is crucial to lift potential growth and navigate rising geopolitical risks.”
The EU’s revamped fiscal rules offer each country the chance to spread spending cuts over a longer period, provided they carry out investments and structural reforms agreed with Brussels.
While the Commission favors spreading out cuts over seven years, only five EU countries are taking that option.
Gentiloni also urged member states to make full use of their share of the EU’s post-Covid recovery fund to pay for public investments, before it expires in 2026.
Overall, today’s Autumn forecast sees this year’s eurozone growth unchanged at 0.8 percent, while trimming growth in the broader EU area to 0.9 percent from 1 percent.
Growth in the EU is expected to accelerate in the coming years, to 1.5 percent in 2025 and 1.8 percent in 2026.
