For Italy, the end of the Covid emergency means a prudent budget policy in the medium term, when the economic conditions allow it. Because, as the EU Commissioner for Economy Paolo Gentiloni explained, the suspension of the rules does not mean that there should not be great attention to avoid the accumulation of greater current expenditure, with permanent consequences on the budgets of the most indebted countries, including Italy.
The warning from the EU Commission is clear. The pandemic weighs on the spring package of the European semester again this year: no report cards and infringement procedures for deficit and debt by Brussels (also because the Stability Pact suspended until the end of 2022), but evaluations to help Member States in the recovery. And for Italy the focus on excessive macroeconomic imbalances determined by the high public debt, by the low growth and by the fragility of the banking system which, despite the strengthening of the past years, will have to face an increase in non-performing loans when the support to the economy ceases. On employment, the Commission notes that Italy was the only EU country that introduced a universal ban on layoffs at the beginning of the crisis. This is a measure, for Brussels, which mostly benefits the “insiders”, ie workers with permanent contracts, to the detriment of temporary and seasonal workers. Furthermore, a comparison with the evolution of the labor market in other Member States, which have not introduced this measure, suggests that the prohibition on dismissal was not particularly effective and proved superfluous in view of the extensive use of job retention systems. of work. At the press conference Labor Commissioner Nicolas Schmit indicated the preferable way to move to a more active labor market by focusing on the requalification of skills: The labor market cannot be frozen for a long time – he said -. But the transition must be made easier.
The pandemic has put virtually all European countries in difficulty. Together with Italy, Greece and Cyprus also record excessive imbalances, while Croatia, France, Germany, Ireland, the Netherlands, Portugal, Romania, Spain and Sweden record excessive imbalances. The Commission expects that the implementation of reforms and investments under the Next Generation Eu will help address the problems identified in the previous cycles of the semester and will play an important role in correcting existing macroeconomic imbalances. For the EU as a whole, we expect the Recovery Plan to give an economic boost of 1.2% of GDP – said Commission Vice President Valdis Dombrovskis – and help create around 800,000 jobs by the end of next year. year.
With the recovery advancing, other dossiers are also returning to the Commission’s table, including that of tariffs and the reform of the taxation of multinationals. On Wednesday, the US suspended tariffs on six countries, including Italy, which had imposed discriminatory taxes on American technology companies, to allow more time to reach an agreement on international taxation within the OECD. A decision that Brussels welcomed. The OECD also yesterday registered a inflation increase of 3.3% in April, on an annual basis, from 2.4% in March, reaching the highest level since October 2008.