In a communiqué the EU Commission for the first time argues for more public investments in Europe. This gives reason to hope that the EU at last abandons its austerity policy and makes the investments which are needed to boost the economy.

After EU Commission President Jean-Claude Juncker in his State of the Union in September had already pointed out that the EU's social dimension had to be expanded and investments had to be stepped up, the Commission is now again signalling a cautious turn away from austerity policy towards investments which are urgently needed to boost the economy. Only then it will be possible to combat the far too high unemployment, particularly among young people.

Commission for the first time in favour of stimulus package

The Commission writes in a communiqué that there was currently both the necessity and a favourable window of opportunity for realigning fiscal policy, which should be more expansive in the future. In other words: Europe needs more investments. In particular Pierre Moscovici, European Commissioner for Economic and Financial Affairs, emphasised that the Commission would for the first time actively argue for a stimulus package and in doing so would also promote the deepening of European cooperation in economic policy.

In concrete terms, the Commission regards 0.5% of the Gross Domestic Product in national budgets of Member States as desirable to advance economic recovery. This is an important signal, even though this alone will not trigger a boom – in particular in view of the fact that cautious investments had been planned in any case. Nonetheless it has to be welcomed that at last emphasis is placed again on reviving the economy and that Commission President Juncker remains consistent.

Even better would be a Golden Investment Rule

However, the AK has argued for quite some time to go even further and to introduce a Golden Investment Rule. This would allow Member States to make future-oriented investments themselves without bypass constructions. Currently these are prevented by the one-side austerity corset of the Stability Pact. A significant advantage of this Golden Investment Rule would be that investments would no longer have to be made in cooperation with private investors, for whom the public sector gives guarantees. The AK had criticised the risk that profits once again are privatised whilst losses are borne by the general public, with regard to the European Fund for Strategic Investments (EFSI) in its current construction – although it too has to be welcomed in general.

Further information

Communiqué der EU Commission

AK Position Paper on EFSI

More about the Golden Investment Rule

Study "Implementing the Golden-Rule for Public Investment in Europe"

Report by EurActiv on the turn of the Commission