(Teleborsa) – “The current ones budget rules (of the European Union, ed) are too complex, too difficult to follow and too difficult to apply. A revision of the rules should aim to increase the sense of belonging on the part of countries, reduce complexity and make room for urgent challenges such as the climate. The euro area would also benefit from one greater budget integration and efforts should be made to establish a common fiscal stabilization capacity for shocks too large to be managed at the national level ”. In the latest edition of the Economic Surveys of the European Union and of the Euro Area, the OECD harshly criticizes the European fiscal rules, asking for their modification to favor post-pandemic growth.
The international body based in Paris emphasizes i dangers of premature withdrawal of fiscal and monetary support fielded by the EU institutions during the pandemic and suggests providing clarity on the future evolution of these policies according to the progression of the recovery. According to the OECD, the euro area can live with inflation slightly above its 2% target for a limited period and Next Generation EU funds should be invested quickly to promote growth and employment, support the green and digital transition, reduce territorial inequalities.
“European leaders have done very well in managing the economic shock triggered by Covid-19, drawing on the lessons learned from the 2008 crisis and implementing bold policy measures, including using common loans for the first time“Said OECD Secretary General Mathias Cormann. “As part of the recovery plans, the time has come to address both long-standing and more recent structural challenges, but addressing them in a way that puts the EU and the euro area on firmer foundations and trajectories for the future” , he added.
In the chapter that deals with the problems of the budgetary governance of the Old Continent, the OECD observes that “the Covid-19 crisis has significantly worsened budget balances, causing public debt to rise to new highs”. Although the existing framework has room for flexibility, “its strict compliance would require major consolidation efforts in the coming years, risking to derail the recovery”. In this context, “the current set of budgetary rules should be assessed with the objective of ensure better sustainability of public finances, sufficient anti-cyclicality and greater accountability“.