The case for a European public-goods fund
With the bloc’s pandemic recovery fund set to end in 2026, there is a need for more durable financial mechanisms
FOLLOWING weeks of intense negotiations, the European Union has agreed to revise its fiscal rules. The new rulebook will replace the Stability and Growth Pact (SGP) – which has been suspended since the start of the Covid-19 pandemic – and modernise the bloc’s 25-year-old fiscal framework.
While the SGP featured a one-size-fits-all model that ultimately undermined its credibility, the updated fiscal rules allow for a differentiated approach. The goal is to maintain the existing deficit and public debt limits, while still encouraging member states to invest in green and digital technologies.
Member states will be granted extended adjustment periods of up to seven years to reduce their debts to sustainable levels, provided they commit to reforms and investments that support this double – green and digital – transition.
KEYWORDS IN THIS ARTICLE
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Opinion & Features
Shameless comebacks show we are in the age of chutzpah
It is time to put idle cash back into the market
Consider housing policy tweaks to boost Singapore’s birth rate
Gauging sentiment is crucial, and there are hard and easy ways to do it
Interests of OCBC and Great Eastern’s minority shareholders are fundamentally misaligned
The election-devaluation cycle