Additional considerations on the way forward for the European Semester 2025

Key points

The EESC:

• is concerned about the existence of multiple factors that are involved in – and sources of – instability and geopolitical risk, in particular those that threaten peace, democracy and respect for human rights, but also those – such as the trade war – that have an impact on growth and inflation, the security of supply chains and access to critical raw materials;
• is concerned that investment trends, both public and private, are far from contributing to any significant reduction in the large investment deficit accumulated by the European economies;
• endorses the two main policy priorities outlined in the 2025 European Semester Spring Package – namely strengthening competitiveness and enhancing defence capabilities – and it supports the main objective of implementing national recovery and resilience plan (NRRP) investment and reforms by 2026;
• believes that once inflation has been brought under control, the time will have come to develop a moderately expansionary monetary policy that encourages investment and, at the same time, takes advantage of the weak dollar to strengthen the role of the euro as a global reserve currency, through the following three measures: introducing the digital euro; utilising the stock of debt which, while financing investment policy, makes it attractive to trade on the markets; and urgently completing the Banking Union and the Capital Markets Union;
• considers that it would be necessary for the post-2027 Multiannual Financial Framework (MFF) to amount to the equivalent of 2% of EU GDP in order to achieve the investment objectives for: reducing the competitiveness gap; boosting research and technological innovation; securing the green and digital just transitions; strengthening social cohesion and compliance with the European Pillar of Social Rights; fostering strategic autonomy in foreign, security and defence policy; and strengthening European industry through policies and measures that facilitate investment, in order to attract internal and external capital;
• believes it is necessary to adopt a set of measures to strengthen investment between now and 2028, inter alia: ensuring the implementation of all Recovery and Resilience Facility (RRF) funds with the new targets and, if necessary, deploying unused funds for new investment programmes in European public goods; creating a European Fund for Strategic Investments; strengthening the EIB's lending capacity to expand InvestEU; and exploring the possibility of using European Stability Mechanism funds;
• reiterates its concern about delays in revising the current debt sustainability analysis model (DSA), as this may unduly sacrifice social spending in favour of other spending, at a time when Member States have to reach unchanged deficit targets;
• agrees with the general principle behind the Omnibus I and II legislative packages to clarify and simplify European legislation and reduce unnecessary administrative burdens on companies, in particular SMEs, but it is concerned that some of the provisions may lead to weaker sustainable finance legislation and therefore jeopardise achievement of the objectives of the Green Deal and its Action Plan;
• reiterates its call for permanent, structured involvement of the social partners and civil society organisations in the various stages of the European Semester process.