European rules on investment, structural reforms and fiscal consolidation should be revised

Former Prime Minister Alfred Sant told the European Parliament that what is urgently needed in Europe, is a recognition that independently of Brexit and Trump, the rules on investment, structural reforms and fiscal consolidation should be revised. Dr Sant said the European Semester rules have not led to a stable, significant and sustainable recovery in Europe, failing to boost growth, significantly reduce unemployment and revive investments. These rules, which were defined in a period when the state of affairs was completely different to the current one, were instrumental in driving down public investment.

Dr Sant addressed the European Parliament in Strasbourg on the European Semester package including the Annual Growth Survey 2017. This document was published by the Commission last week and the Commission officially presented it to European Parliament for discussion. The Annual Growth Survey officially launches the European Semester process for the year ahead. In particular, it sets out the general economic priorities for the EU and offers EU governments policy guidance for the following year. The Commission guidance is built around three inter-connected strands: investment, structural reforms and fiscal consolidation.
Dr Sant said it is counterproductive to refer to Brexit and the Trump election as a sign of the times that justifies reconsideration of policies followed under European semester rules. These rules were defined technically, even when sometimes, they were interpreted politically. They helped prevent a recurrence of 2008 but they have not led to a stable, significant and sustainable recovery in Europe. They failed technically and this is generating a political backlash.
The Maltese MEP said unemployment remains at historically high levels, economic growth anaemic. Investment has not revived, in the public and private sectors. The rules embedded in the European semester process are the main contributors to this state of affairs. They were defined in a period when the situation was completely different to the one we are in. The benchmarks they set no longer fit our circumstances. Some of them were anyway set arbitrarily and have no logical or existential justification.

The rules themselves were instrumental in driving down public investment. In turn, private investment which piggy backs on public investment was negatively affected. What is urgently needed in Europe, is a recognition that independently of Brexit and Trump, the rules set by the Stability and Growth Pact should be revised, remarked Dr Sant.

You may follow Dr Sant’s remarks on this link:

Maltese Version – IR-REGOLI EWROPEJ DWAR L-INVESTIMENT, IR-RIFORMI STRUTTURALI U L-KONSOLIDAMENT FISKALI GĦANDHOM IKUNU RIVEDUTI

L-Ewropa għandha bżonn tagħraf li, indipendentement mill-Brexit u Trump, ir-regoli dwar l-investiment, ir-riformi strutturali u l-konsolidament fiskali ikunu riveduti. Fil-Parlament Ewropew fi Strasburgu Dr Alfred Sant qal li r-regoli tas-Semestru Ewropew ma wasslux għal Ewropa aktar stabbli u għal fejqan ekonomiku aktar sostenibbli. Ir-regoli ma rnexxilhomx jagħtu spinta lil ekonomija Ewropea, ma naqqsux il-qgħad u ma tawx nifs ġdid lil investiment. Dawn ir-regoli, li saru fi żmien meta l-qagħda ekonomika kienet kompletament differenti minn ta’ issa, wasslu għal tnaqqis tal-investiment pubbliku.
Dr Sant tkellem waqt id-dibattitu dwar is-Semestru Ewropew li kien jinkludi l-‘Annual Growth Survey 2017’. Dan id-dokument ġie ppubblikat mill-Kummissjoni Ewropea l-ġimgħa l-oħra u ippreżentat lil Parlament Ewropew għad-diskussjoni. L-Annual Growth Survey uffiċċjalment jiftaħ il-proċess għas-Semestru Ewropew għas-sena li jmiss. B’mod partikolari, jfassal il-prijoritajiet ekonomiċi għall-UE u joffri lil mexxejja Ewropej linji gwida għas-sena li tkun ġejja. Il-linji gwida tal-Kummissjoni mibnija fuq tliet pilastri marbuta ma’ xulxin: l-investiment, ir-riformi strutturali u l-konsolidament fiskali.
Dr Sant saħaq li mhux produttiv li nirreferu għal Brexit u għal Trump bħala sinjal li wasal iż-żmien li nirrevedu l-politika li tintuża għar-regoli tas-Semestru Ewropew. Dawn ir-regoli nħolqu b’mod tekniku, anki meta kultant, kienu interpretati b’mod politiku. Għenu biex ma jerġgħux jinħolqu ċ-ċirkostanzi tal-2008 imma ma wasslux għal stabilita` u għal żvilupp sostenibbli u sinifikattiv fl-ekonomija Ewropea. B’mod tekniku r-regoli ma ħadmux kif mixtieq u dan qed iwassal għal reazzjoni politika negattiva.
L-Ewroparlamentari Malti qal li l-qgħad baqa’ f’livelli għolja, it-tkabbir ekonomiku baqa’ fjakk. L-investiment ma ħax nifs ġdid, kemm fis-settur privat u anki f’dak pubbliku. Ir-regoli tas-Semestru Ewropew jikkontribwixxu bil-kbir għall-istat li qegħdin fih bħalissa. Dan għaliex dawn tħejjew fi żmien meta s-sitwazzjoni kienet kompletament differenti minn dik li għandna llum. Il-linji tagħhom ma jaqblux maċ-ċirkostanzi tal-lum. Ftit minnhom tħejjew b’mod arbitrarju u l-eżistenza tagħhom mhix ġustifikata.
Ir-regoli nfushom swew biex naqas l-investiment pubbliku. B’hekk, l-investiment privat, li jirkeb fuq dak pubbliku, wkoll ġie affettwat ħażin. Hemm bżonn urġenti li l-Ewropa taċċetta li indipendentement mill-Brexit u minn Trump, ir-regoli tal-Patt ta’ Tkabbir u Stabilita` jeħtieġu reviżjoni, saħaq Dr Sant.

Segwi l-intervent ta’ Dr Sant fuq din il-link: