The organization points to strengthening the Single Market and reducing emissions as catalysts for progress in the EU
MADRID, 6 Sep. (EUROPA PRESS) –
The Organization for Economic Cooperation and Development (OECD) has predicted that the expansion of activity will pick up from 0.9% in 2023 to 1.5% in 2024, the time that has indicated that the European Union “needs a deepening of the Single Market” and accelerate efforts to reduce polluting emissions to “ensure stronger and more sustainable growth”.
The multilateral organization has affirmed that the economic survey for Europe published this Wednesday foresees that growth in the countries of the common currency “will gradually rebound” from 0.9% this 2023 to 1.5% next year, at the same time that inflation will moderate from 5.8% in 2023 to 3.2% in 2024.
However, the OECD maintains that, although Europe has coordinated to face the consequences of the war in Ukraine and has avoided a “severe setback”, the short-term outlook continues to be dominated by “uncertainty”.
Thus, the organization has affirmed that the reinforcement of the Single Market can help Europe to promote growth, innovation and structural transformation.
As main measures, the OECD encourages reinforcing a level playing field in the deployment of state aid, redirecting EU resources towards ‘green’ R&D, as well as harmonizing national legislation and aligning it with European rules on digitalisation, economic circular and construction. The concerted fight against corruption and fraud must also be insisted upon.
Regarding climate change, in order to reach the goal of net zero emissions in 2050, the reduction of emissions must be “accelerated”, especially in sectors not covered by the system of emission rights, such as agriculture, construction or transport.
The OECD has also noted that a successful ‘green’ transition requires energy to be ‘safe’ and ‘affordable’, as well as further integration of electricity markets.
In addition, what is known as the ‘club of the rich countries’ has advanced that curbing inflation will require a “continuation of the restrictive monetary policy” and a “more fine-tuned and sustainable” fiscal policy that leads to “more prudent” debt levels. .
On the other hand, financial vulnerabilities are “considerable”, especially in countries with high levels of private debt and a high proportion of variable mortgages.
“The authorities should apply macroprudential policies and other specific instruments to address risks in the financial sector, as necessary,” the OECD has recommended.
