Series: Economic Notes.
Author: Pilar García Perea, Antonio Millaruelo, Víctor María Mora Bajén and María del Carmen Sánchez Carretero.
Topics: European Union, Economic situation, Structural analysis.
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Summary
The 2020 European Semester has adapted to coordinate Member States’ economic policy and to provide an immediate fiscal, economic and social response to the crisis arising from the pandemic. The priority has been to reinforce health systems and support households and businesses, which has required activating the general escape clause from the Stability and Growth Pact and reorienting the recommendations for all Member States. Within the framework of the EU budget and in coordination with the European Semester, on 21 July the European Council created a new instrument – Next Generation EU – that is intended to help fund the recovery of the economies of the Member States in the wake of the pandemic. In October, Member States will have to present reform plans and investment projects, to be incorporated into their national budgets for next year, in keeping with the recommendations for 2020 that are designed to address the challenges deriving from climate change, digitalisation, building up human capital and public sector efficiency.