Macroeconomic dialogue at political level on 8 November 2021

Macroeconomic dialogue at political level on 8 November 2021

The 43rd meeting of the macroeconomic dialogue at political level focused on the economic outlook and the digital transformation in light of the recovery.

Today, we agreed that the recovery after the pandemic is strong and the macroeconomic outlook bright. We still have to be careful about the risks, mostly those associated with the virus, and we also have to adjust to the novelties that the pandemic accelerated. One of them is digital transformation. When it comes to digitalization, the EU has a lot of space for improvement. Here lies a great potential to revive the productivity and ensure future growth. However, we have to make sure that the transition is inclusive. We have to ensure that the current and future workers will have access to reskilling and upskilling. Those who need more support with the transition should receive it. The digital transition will only be a success if there is a driving force behind it – and this force are the workers. Hence, a close cooperation with all relevant stakeholders will be crucial for an inclusive and successful digital transformation.

Andrej Šircelj, Minister of Finance for Slovenia which currently holds the presidency of the Council

The EU economy is recovering and all EU countries will return to their 2019 GDP levels this year or next, some have already done so. There is still uncertainty and new risks are emerging. Europe needs to stay the course of reforms and investments agreed under the Recovery and Resilience Facility to advance the economic transformation and green and digital transitions. Investing in digital skills and the adoption of digital technologies are top priorities, including under the RRF. The 22 national recovery and resilience plans endorsed by the Commission so far dedicate nearly €120 billion to support the digital transition – boosting investments in connectivity, digital skills, advanced technologies and research capacity, as well as for digitalising businesses and public services. Support from social partners and civil society will be essential for us to navigate our way through the recovery and the digital, green and demographic transitions.

Commission Executive Vice-President Valdis Dombrovskis

The digital transition for some is almost seamless but for others, digitalisation is more challenging and not necessarily automatic. That is why policy will need to be increasingly targeted. We need to take advantage of the current economic rebound and new instruments, such as our EU Recovery Fund, to reskill and upskill our workforce while promoting an inclusive society. This is where social partners will have a crucial role to play.

President of the Eurogroup Paschal Donohoe

The European economy is growing, but many working people are not benefitting. The total numbers of hours worked and the average hours worked are below pre-pandemic levels, and may not reach pre-pandemic levels until 2026 according to a recent ETUI study. This will leave young and low-skilled workers with inadequate wages and restricted opportunities. With rocketing energy prices, and wages declining in the second quarter of this year, there is a real risk of mass energy poverty. Emergency measures need to be continued, stabilisers like SURE must be made permanent and EU investment programmes Next Generation EU stimulus package must include conditions and monitoring mechanisms to ensure massive job creation and actions to level up inequality.

Luca Visentini, ETUC General Secretary

While recovery is in sight the EU needs to remain very alert to the dangers. COVID is not over yet and financial support is still needed. Although public investment rates are increasing, this is largely due to EU support. A round of cut backs would be catastrophic for the European economy. It is possible, and essential, to offer financial support, especially for socially just climate action and digitalisation, and to have sustainable public finances. The ETUC will be pressing for effective reform of EU economic policymaking rules to enable investment, to make debt sustainable and to avoid austerity.

Liina Carr, ETUC Confederal Secretary

The EU economy is undergoing a strong recovery which gives ground for optimism for Europe’s businesses after a long period of almost unparalleled hardship. At the same time, bottlenecks and supply side constraints are slowing down the economic recovery and increase inflationary pressure. These phenomena together with other factors bear the considerable risk that they, if not met with sufficient moderation, could give rise to a damaging wage-price spiral, which would cause permanently higher inflation and would be detrimental to Europe’s global competitiveness.

BusinessEurope Director General Markus J. Beyer

The implementation of the National Recovery and Resilience Plans is crucial to achieve long-term growth potential in line with the transformation of our economies. Essential services of general interest should be placed at the heart of the investments and reforms elements of the Recovery and Resilience Facility. All 27 National Recovery Resilience Plans must reinforce the accessibility, affordability, and quality of key SGIs to ensure the EU strategic autonomy and protect the most vulnerable. The review of the EU economic governance is a historical opportunity to align the investment approach of the Next Generation EU with fiscal policies, with the ultimate aim to attain sustainable debt financing research, education and digital and green infrastructures.

Valeria Ronzitti, General Secretary of SGI Europe

Supply bottlenecks and high energy and commodity prices are becoming a threat for the recovery. SMEs fear inflation and second round effects on wages, which could add to the already-existing lack of skilled staff. Therefore, phasing out of covid measures should be done smoothly and may not put the solvency of viable businesses in danger. Finally, fostering digitalisation of SMEs requires measures which ensure access to infrastructure, technology, finance and skills. Moreover, the regulatory environment must be predictable and guarantee fair access to data and SME friendly standards.

Véronique Willems, SMEunited Secretary General

If we want to benefit from the recovery, we cannot be content to return to the old ways. We must look beyond that. It is essential to invest more in the industries of the future to roll out the digital and climate transitions. Fostering innovation and boosting potential growth will be our way to achieve strong, low-carbon growth.

Incoming French Presidency (Jan-Jun 2022)

The importance of the digitalisation process is undeniable. It will increase the competitiveness of EU companies, make life easier for citizens and reduce costs for public administrations. It is also an important driver for increasing labour productivity. To make the process a success, we need to increase people’s trust in the digital economy. This means setting a clear and trustworthy legislative environment and minimising bureaucracy for citizens, businesses and public administrations.

Future Czech Presidency (Jul-Dec 2022)

Source: Macroeconomic dialogue at political level on 8 November 2021 – Consilium (europa.eu)

Photo Credit : https://pixabay.com/nl/photos/geld-euro-financi%c3%abn-munteenheid-2259045/

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