BRUSSELS – ANSWER. A clear signal to phase out energy support measures for businesses and vulnerable households to initiate a reduction in the budget deficit was sent yesterday Eurozone finance ministers.

During yesterday’s meeting Eurogroup In Brussels, it was estimated that the impact of the sharp rise in energy prices has now been mitigated by measures to support businesses and households, and the time has come for more targeted rather than horizontal or permanent measures.

“We will be closely monitoring the impact on aggregate demand and the fiscal position of additional energy support measures or the extension of existing ones, given the uncertainty about the evolution of energy prices. We must avoid persistent measures that increase the deficit,” the Eurogroup said in a statement.

The reasons why eurozone finance ministers decided to phase out energy support measures were explained in detail at a press conference after the meeting by the responsible commissioner. Paolo Gentiloni and president of the Eurogroup, Pascal Donahue.

Mr. Gentiloni stressed that early summer forecasts of a deep recession in the euro area due to the energy crisis did not come true. Both men noted that labor markets are showing strong performance, and the unemployment rate is at an all-time low of 6.6 percent. “We remain moderately optimistic,” Paolo Gentiloni said characteristically, noting the effectiveness of coordinated action on behalf of the EU. to overcome the energy crisis.

“We must avoid permanent measures that increase the deficit.”

However, the competent commissioner did not fail to emphasize that growth prospects remain low in 2023, while, according to him, at the same time, a number of eurozone member countries are recording high debt. At the same time, core inflation also remains high, as indicated.

For this reason, with regard to fiscal policy, the Eurogroup agreed with the Commission’s recent relevant recommendation of 8 March, namely that “over the period 2023-2024, prudent fiscal policy should aim to ensure medium-term debt sustainability while increasing the potential growth in a sustainable way.”

The relevant Eurogroup statement emphasizes, in addition, that fiscal policy will contribute to the stability of the Eurozone economy and will contribute to the effective transmission of monetary policy in an environment of high inflation. It also stated that “we will coordinate our efforts to maintain a level playing field and the integrity of the single market.”

Changes in fiscal rules will also be discussed at today’s meeting of EU finance ministers. (Ekofin) for the purpose of signing draft conclusions.

In addition, his revision Stability Pact was not discussed at yesterday’s meeting of eurozone finance ministers as the coordination and related discussion has now been taken over by Ecofin under the Swedish EU Presidency.