The European Commission will issue guidance “in spring” to EU governments on when it thinks European Union budget rules limiting borrowing should be observed again after they were suspended last year to help fight the effects of the pandemic. https://www.eudebates.tv/debates/eu-policies/economy/eu-taxation-tries-to-follow-digital-and-globalised-economy/

European Commissioner for Economic and Financial Affairs Paolo Gentiloni told a news conference the gradual withdrawal of trillions of euros in national and EU support measures to the economy would have to be managed carefully to avoid a sharp rise in bankruptcies.

Limits on government borrowing set by EU budget rules are suspended until the end of 2021. The timing “in spring” of the Commission guidance on the fiscal stance in 2022 is to allow EU countries time to prepare their budgets for next year.

European Union Economic Commissioner Paolo Gentiloni said on Monday that they will tell eurozone countries in spring whether or not EU budget rules will remain suspended in 2022, as reported by Reuters.

"We have to avoid a sharp rise in insolvencies in the future," Gentiloni added. "A careful management of the withdrawal of support measures for companies will be crucial."

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ITALY

The European Union will work with Mario Draghi's new Italian government on overcoming longstanding drags on growth with structural reforms to stifling red tape and a snail-paced civil justice system as well as injecting more competition into the Italian economy, Economic Affairs Commissioner Paolo Gentiloni told Bloomberg TV Monday.

"I am confident that we will work together with the new government above all on reforms regarding civil service bureaucracy, delays in civil justice and competition rules," Gentiloni said. He described these three areas as "bottlenecks which have slowed Italian growth in the last few years".

Gentiloni said ex-ECB chief Draghi's appointment was "excellent news not only for Italy but also for the European Union". He said Draghi would manage the EU COVID recovery funds Italy is set to get - over 200 billion euros - "with all his experience and leadership". Many pro-Europeans are hoping euro saviour Draghi will not only rescue the Italian economy but also boost European prospects for greater financial and fiscal unity.

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