Appeal to the Twenty-Seven

“This is a new step to reinforce governance” at the Community level, said European Commission José Manuel Barroso in presenting the Commission’s 2011 country-specific recommendations. The efforts required to implement them, said Barroso, “will allow Europe to leave the crisis behind it and safeguard our future prosperity”. Barroso has made a personal plea to convince EU member states to act in a coordinated fashion, believing as he does that national economic systems are “increasingly interdependent”. In proposing its “economic recommendations” to the 27, he has therefore placed particular emphasis on the need for responsibility and coordination. Collective governance. On 7 June the Commission adopted country-specific recommendations for 2011 “to help member states to gear up their economic and social policies to deliver on growth, jobs and public finances”. All these recommendations are part of the so-called “European Semester”, which is one of the planks of the “collective economic governance” on which the EU seems to be insisting with greater conviction than in the past. “The crisis has left its mark”, points out Barroso. These recommendations – which will now pass to the scrutiny of the Council of Economic Ministers and the European Council of 23-24 June for their definitive endorsement – have been formulated on the basis of programmes of growth and stringency in public accounts by the member states themselves between April and May this year. The proposed economic stimulus measures, and the reforms called for in the fiscal field and in favour of job creation, have a temporal horizon of 12-18 months. It will be up to the Commission to see to it that member states maintain the commitments they have signed up to.Hard choices. “The EU economy is at a critical juncture – says Barroso in his press release -. The recovery is gaining ground, but it is very uneven across the continent, and many uncertainties remain”. “Member states agreed in March an important set of commitments for the next 12 to 18 months. They must now make sure that they all implement these in a tailored way at national level. With today’s country-specific recommendations, which are targeted and measureable, the Commission gives member states its assessment of their national plans. We know – Barroso admits – that achieving the goals we have collectively set ourselves means sometimes hard choices. But these efforts, if made seriously and by all, will allow Europe to leave the crisis behind it and safeguard our future prosperity”.Lack of ambition. The Commission’s documents comments: “Overall, member states have sought to reflect the agreed EU priorities in their programmes and their macroeconomic assumptions are broadly realistic. However, national programmes often lack ambition and specificity. Many member states need to be more ambitious on fiscal consolidation, while maintaining growth-enhancing measures (research and innovation, business environment, competition in the services sector). On labour markets, more efforts are needed to increase labour-force participation, combat structural unemployment, reduce youth unemployment and early school-leaving and ensure wages reflect productivity”. Laszlo Andor, Commissioner of Employment and Social Affairs, puts the emphasis on the need to “intervene on structural unemployment”; and also underlines other points, such as the growth of pensionable age, provisions in favour of disadvantaged categories, and the insertion of a larger number of women in the labour market. In his view there’s a need “to de-fiscalize labour, and impose less costs on it” so as to facilitate the growth of youth unemployment.National cases. It’s up to the Commissioner for Economic and Monetary Affairs, Olli Rehn, to analyse national cases in greater detail. Austria, for example, is being asked to “correct its excessive deficit also by exploiting the recovery now underway”. The recommendation for France is to provide for the “sustainability of its pension system”, while in Germany’s case the emphasis is placed on the restructuring of its regional banks. As far as Italy is concerned “the number one priority is its excessive debt” and therefore bindings ceilings on public expenditure would be needed. In the case of Finland, homeland of Commissioner Rehn, where efforts to build a solid political majority have failed, “the political crisis needs to be overcome, so as to have a government able to tackle important challenges”. As was only to be expected, the Commission’s spotlight falls on countries that have obtained European and international aid, such as Ireland, Greece and Portugal. Of the latter the Portuguese Barroso said that it “needs to concentrate on the obligations it has assumed towards the EU and the IMF. From the recent elections, besides, it has emerged that 80% of MPs in the new Parliament are favourable to the accords signed with the troika” (EU, IMF and ECB). “Trust and political stability are now essential to respect the commitments signed up to”.