European finance ministers will meet tomorrow and Friday with the prospects for the eurozone’s economy and the budget position of various member-states topping the agenda.
Tomorrow sees a gathering of the Eurogroup, which represents the 19 members of the single currency zone, while on Friday all 28 member-states will be represented at a meeting of the finance ministers’ council ECOFIN.
These will be the first official meetings of finance ministers since Austria took over the rotating six-monthly presidency of the European Union on 1 July. On the face of it, the Eurogroup agenda is meatier than that of ECOFIN, which may reflect the growing importance of eurozone issues within the wider EU context.
Unemployment lower but still high
Current Eurogroup president Mario Centene, the Portuguese finance minister, will host the meeting, at which the summer economic forecast from the European Commission will be presented.
It added: “Unemployment continues to fall and is now around pre-crisis levels. In the EU, unemployment is set to continue to decline from 7.6% in 2017 to 7.1% in 2018 and 6.7% in 2019.”
However, these levels are high by the standards of Britain or America, where a jobless rate of 5% of the workforce or less has become the norm. Furthermore, these are EU-wide figures. According to the Commission, unemployment is forecast to fall from 9.1% in 2017 to 8.4% in 2018 and 7.9% in 2019.
VAT changes on agenda
The Eurogroup will also encroach on the sensitive area of the fiscal policies of the members of the single-currency bloc. It said: “Ministers will hold another discussion on the budgetary situation in the euro area as a whole. The results of this exchange will contribute to the preparation of the euro area member states’ draft budgetary plans, as well as of the recommendation for the euro area member states for 2019.”
These recommendations are made by the European Commission.
Britain, the most significant non-euro member, is due to leave the EU next year, leaving only Denmark from an official opt-out. Six non-members in eastern Europe are obliged to join at an indeterminate date once they have fulfilled the economic and fiscal conditions. Sweden is also supposed to join, but has given itself a let-out by deciding, in a referendum, not to make its central bank independent, which is a precondition for membership.