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BackModerate recovery, growing imbalance
In its Annual Growth Survey, the Commission indicates a moderate recovery of the economy. Even though the recovery was derived from temporary factors such as the weak euro and currency adjustment measures, it would, however, present an initial effect of the reforms of the past years. However, at the same time, the Survey points towards a widening of the economic and social differences between Member States.
Investing and saving at the same time – the Commission makes it possible!
Hence, the Commission issues a familiar contradictory slogan – on the one hand, it demands a revival of investment activity, whilst at the same time urging for a responsible fiscal policy and the continuation of structural reforms – hence, it remains caught in its own contradiction of wanting investments and at the same time denying States any budgetary scope to get the ball rolling.
It hopes among other that these investments will be a result of the so-called Juncker Plan (“Investment Plan for Europe”), whose clout yet has to be proven.
The Banking and Capital Markets Union shall also contribute to a rise in investments – paradoxically through liberalisation and closer networking of the European capital markets, which, however, were more resulting in the crisis, rather than being its solution.
Social Aspects and employment
According to Marianne Thyssen, Commissioner of Employment, Social Affairs, Skills and Labour Mobility, the Annual Growth Survey would make social justice a key element of economic recovery. By making this comment she is pointing out that for the first time, employment indicators have been included in the Alert Mechanism Report. Even though this is to be welcomed, these employment figures, however, have the character of non-binding additional information, which take second place behind questions of national debt.
The results of the Growth Report in respect of the labour market situation continue to be alarming: Even though the level of unemployment is falling, it is still at a record high. 50 % of unemployed people are long-term unemployed. The indicators of youth unemployment and living conditions continue to show drastic differences between the EU States. Now the integration of refugees in the labour market had to be tackled; this had to be done as quickly as possible.
Alert Mechanism Report: Austria included for the first time
The Alert Mechanism Report is the annual starting point of the Macroeconomic Imbalance Procedure, in which it is determined, which States might be faced with economic imbalances. Based on the States included in the Alert Report, the Commission prepares in-depth analyses, which investigate these supposed imbalances. This year, 18 of the 28 Member States will be reviewed. For the first time, Austria will also be included in the alert mechanism. Due to the strong international integration and therefore dependency of her financial sector on the development of foreign financial markets, Austria will for the first time also be included in the alert mechanism. The impact on credit provided to the private sector will also be analysed. The in-depth analysis will be published in February 2016.
Independent Growth Report
As an alternative to the Survey of the Commission, the AK in cooperation with other research centres has prepared an independent Annual Growth Survey, which comes to deviating results: what is required for a recovery of the economy is an active increase in demand, policies against unequal distribution and public investments in environmentally sensible projects.
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