Parliament backs the EU Commission case for investing in innovation, growth and job creation, pursuing socially-balanced structural reforms, and encouraging responsible public finances, in a resolution on EU economic priorities for 2017, voted on Wednesday.
The text was approved by 423 votes to 210, with 48 abstentions.
MEPs decide on the EU’s economic priorities for 2017 against a backdrop of large current account surpluses, low domestic investment, a lower than expected growth forecast, economic uncertainty deriving inter alia from the UK’s EU exit referendum, troubled relations with Russia and high youth unemployment.
Stimulate demand and investment
“High and consistent current account surpluses hint at a need to stimulate demand and investment in order to cope with future challenges in areas such as transport, communication, the digital economy, education, innovation and research, climate change, energy, environmental protection and the ageing population”, says the resolution, drafted by Alfred Sant (S&D, MT).
The resolution says that further measures are needed to increase financing opportunities, notably for small and medium-sized enterprises (SMEs) and to reduce non-performing loans (NPLs) in the euro area and in line with EU legislation, in order to make bank balance sheets sounder and hence enable banks to lend more to the real economy.
It also emphasises the importance of completing the Banking Union and developing the Capital Markets Union in order to create a stable environment for investment and growth and prevent fragmentation of the euro area financial market.
MEPs invite the Commission to give priority to measures that reduce the obstacles to greater investment flows and trade, especially in the fields of energy, transport, communications and the digital economy.
National ownership of country-specific recommendations
MEPs fully support efforts to ensure that EU member states feel a greater national “ownership” of the design of, and action on, country-specific economic policy recommendations (CSRs) agreed in EU “European Semester” consultations. To this end, CSRs should be clearly defined around a limited number of EU priorities, with the close involvement of national parliaments and regional and local authorities, says the resolution. MEPs also call on the member states to subject their national reform programmes to proper democratic scrutiny in their national parliaments.
Reduce tax wedge on labour
Members underline the importance of avoiding an excessive tax wedge on labour, so as not to discourage employment, and the need for a shift towards taxing environmental pollution, given that excessive taxation diminishes incentives for the inactive, the unemployed, second earners and low-wage earners to return to employment.
Finally, they deplore the fact that the aim of reducing poverty in the EU is unlikely to be met.
Compliments of the European Parliament