European Union’s (EU’s) Vice President Valdis Dombrovskis said on Wednesday that the European Commission had issued to each member state, tailored economic advice on how to recover from the pandemic.
Dombrovskis said in a statement that COVID-19 had hit the EU “like an asteroid and left a crater-shaped hole in the European economy”.
“The European Union’s executive arm wants to see public health investment, job security measures and support for the corporate sector in the coming months.
“Normally the commission advises EU capitals on how to comply with the bloc’s strict fiscal rules.
“For example by reducing their public debt or even loosening the purse strings and investing more but all these were suspended in March,’’ Dombrovskis said in the statement.
According to him, this time, the recommendations focus on mitigating the coronavirus pandemic’s severe negative socio-economic consequences in the short term and achieving sustainable and inclusive growth in the medium term.
“The commission will not open any excessive deficit procedures against the 27 member states this time round.
“These are exceptional times,’’ Dombrovskis said in Brussels.
He added that the fiscal rules would eventually be reintroduced and states expected to demonstrate compliance.
Under the bloc’s fiscal rules, government deficits should stay within 3 per cent of gross domestic product (GDP) while debt should not rise above 60 per cent of GDP.
Even in economic crises, member states should show they are trying to reach those targets.
However, public health spending and crucial stimulus directed to businesses and the labour market are likely to send the excessive debt levels of Italy, Spain and Greece spiralling even higher. (dpa/NAN)
