Finance ministers in favour of continuation of investment cycle

Brdo pri Kranju – EU finance ministers on Saturday spoke in favour of a continuation of the bloc’s current investment cycle, amidst warnings that the soundness of public finances has to be borne in mind as stimulus spending is gradually wound down.

Slovenian Finance Minister Andrej Šircelj, who described the meeting as “productive and effective”, said everyone participating showed a great desire for Europe to continue with this investment cycle and to become stronger after the pandemic.

The majority of European countries, Slovenia included, have recorded an “unexpectedly positive” rebound. “This means the EU’s response to the crisis has been successful and effective, the results show economies and growing and unemployment is relatively low,” he said.

European Commission Executive Vice-President Valdis Dombrovskis likewise highlighted the robust growth figures, saying that GDP in all EU countries will return to pre-pandemic levels this year or next.

But he said stimulus measures cannot be indefinite. “When the time comes, we will have to gradually start reducing deficit and debt,” he said. All countries will have to improve the quality of their public finances, which will allow them to make investments that are in line with the green and digital transition.

According to Dombrovskis, the member states thus have the dual task of reducing debt while channelling resources into investments. But this will not be enough since the investments need to go hand in hand with structural reforms.

Today’s talks also touched on taxation, with Dombrovskis saying that the majority o the member states had endorsed the OECD agreement on global taxation of corporations, which he said was a turning point. He is hopeful that the remaining member states will endorse the deal by October.