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Opinion of the European Economic and Social Committee – Recommendation for a Council Recommendation on the economic policy of the euro area (COM(2025) 957 final)

EESC 2025/03708

OJ C, C/2026/1961, 28.4.2026, ELI: http://data.europa.eu/eli/C/2026/1961/oj (BG, ES, CS, DA, DE, ET, EL, EN, FR, GA, HR, IT, LV, LT, HU, MT, NL, PL, PT, RO, SK, SL, FI, SV)

ELI: http://data.europa.eu/eli/C/2026/1961/oj

Date of document:: 21/01/2026; Date of vote
Date of vote:: 21/01/2026
Date lodged:: 05/01/2026

Author:: European Economic and Social Committee
Responsible body:: Section for Economic and Monetary Union and Economic and Social Cohesion, EESC_ECO
Rapporteur:: Javier DOZ ORRIT
Form:: Opinion
Internal reference:: AVIS-SECTION 2025/3708 FIN, ECO/687
Session:: 602

Treaty:

Treaty on the Functioning of the European Union

Legal basis:

12016E175

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Earlier related instruments:

52025DC0957 ESC Opinion

Instruments cited:

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Subject matter:

Directory code:

10.30.30.00 Economic and monetary policy and free movement of capital / Economic policy / Economic and monetary union

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Official Journal
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C/2026/1961

28.4.2026

Opinion of the European Economic and Social Committee

Recommendation for a Council Recommendation on the economic policy of the euro area

(COM(2025) 957 final)

(C/2026/1961)

Rapporteur:

Javier DOZ ORRIT

Advisor	Olivier VAUZELLE
Referral	European Commission, 5.1.2026
Legal basis	Article 175 of the Treaty on the Functioning of the European Union Economic and Monetary Union and Economic and Social Cohesion
European Commission documents	COM(2025) 957 final Summary of COM(2025) 957 final
Section responsible	Economic and Monetary Union and Economic and Social Cohesion
Adopted at plenary session	21.1.2026
Plenary session No	602
Outcome of vote (for/against/abstentions)	174/3/9

1. Conclusions and recommendations

1.1.

In order to cope with a geopolitical context fraught with risks and difficulties, Europe must strengthen its political unity, which means developing its strategic autonomy in areas such as foreign, security and defence policy and trade, industrial and technological development policy. The European Economic and Social Committee (EESC) believes that, by serving this objective, economic policy will also boost growth.

1.2.

The EESC agrees with most of the Commission’s recommendations, but is concerned as to whether the EU and the Member States will have sufficient tools, particularly budgetary tools, to implement them. The Committee therefore reiterates that the priority is to mobilise all funding instruments, both public and private, to achieve the objectives of the recommendation.

1.3.

The EESC agrees that increased spending on security and defence is needed in order to strengthen European strategic autonomy, build a European defence pillar and boost the EU’s own industry. The Committee is also concerned that, given the budgetary restrictions imposed by national fiscal plans, defence is being prioritised at the expense of funding for priority environmental and social objectives or even essential energy or digital infrastructure.

1.4.

The mobilisation of all resources starts with making full use of Recovery and Resilience Facility (RRF) funds for the initial objectives, the revised objectives and, ultimately, new investment in European common goods.

1.5.

The EESC agrees with the Commission on the need to prioritise removing the remaining barriers in the single market. The other major challenge, reducing the investment gap – particularly as regards the most advanced technologies – in order to boost productivity and improve competitiveness, needs to be addressed by: creating a Strategic Investment Fund for European common goods; encouraging private investment – renewing InvestEU and completing the Savings and Investments Union without further delay, etc.; lowering energy prices – interconnecting networks and the Energy Union and extending clean and renewable energy; strengthening European R&D&I programmes; and improving education and developing human capital.

1.6.

Regulatory frameworks that facilitate business creation and economic activity complement, but cannot replace, these drivers of improved productivity and competitiveness. The EESC believes that ‘simplification’ should always respect labour and consumer rights and the objectives of the just green and digital transitions. It also believes that it is essential to defend the EU’s regulatory autonomy against external pressures that seek to change good regulations, such as those on digital markets and AI.

1.7.

The EESC believes that access to decent housing is a fundamental right of all European citizens. The severity of the housing crisis in a majority of Member States is such that a specific recommendation on this issue is required. The European Affordable Housing Plan should include all the support measures that the EU can provide to Member States for the construction of social housing, starting with financial support.

1.8.

The EESC agrees with the recommendation on promoting the international role of the euro and creating a digital euro to help achieve this, adding that completing the Capital Markets Union and managing a sufficient and sustainable common stock of debt in euro would also be in line with this objective.

1.9.

The EESC reiterates its call to regulate the participation of organised civil society in the EU’s economic governance through the European semester and regrets that the issue is not addressed in the recommendation.

2. Background: autumn forecast and the Recommendation

2.1.

The European Commission has issued its autumn forecast (1) at a period of serious geopolitical conflicts and risks and high geo-economic tensions, rendering any kind of forecast risky. According to most analysts, it is still too early to assess the impact on trade policy of the unilateralism imposed by the current US government, completely outside the rules of the World Trade Organization (WTO).

2.2.

As the recommendation (2) points out, attacks on multilateralism are leading to a more fragmented global order, with trade and finance patterns being reshaped in a way that affects global supply chains and creates volatility in trade and energy markets as well as in capital flows. The recently published US National Security Strategy (3), which surprisingly identifies the European Union and the democratic values that define it as the main adversary, aggravates this situation, affecting key EU policies, and economic policy in particular.

2.3.

Against this unfavourable and risk-laden backdrop, the European economy is demonstrating a degree of resilience, reflected in the fact that the forecasts remain unchanged, with slightly improved growth forecasts issued in the autumn – 1,4 % for 2025 and 2026, and 1,5 % in 2027 in the EU, and 1,3 %, 1,2 % and 1,4 % in the euro area – compared to the spring forecast, and in the fact that inflation is under control – 2,1 % in 2025 and 1,9 % and 2 % in the following two years, in the euro area – slightly higher in the EU as a whole and compared to the spring forecast, in line with the variations in growth. The ECB’s targets have already been met. In the euro area, government deficit figures are stable at around 3,3 % of GDP over the three years in question; public debt shows a slight upward trend, from 88,8 % to 90,4 % of GDP. In the EU, deficit projections are similar and public debt projections are about 6 percentage points lower. There is no significant change compared to the spring forecast.

2.4.

The recommendation sets out, as its main objectives, closing the innovation gap, decarbonising the economy and reducing strategic dependencies, while at the same time easing the neutral fiscal stance to accommodate pledges to increase defence spending in a way that does not jeopardise the sustainability of public finances. To make progress on these objectives, the guidance covers a number of factors, including: public and private investment; the implementation of the recovery and resilience plans; the labour market, skills and training; the role of social dialogue; the removal of barriers in the single market and regulatory simplification; the Savings and Investments Union; and the role of the euro as a global reserve currency. The Commission believes that the measures it proposes will improve the productivity and competitiveness of the EU’s economies and that they can be implemented without affecting social cohesion and in a way that continues to ensure progress on the green and digital transitions.

3. General comments: the EESC's view

3.1.

The Committee believes that most of the recommendations go in the right direction, but that some of them – and the recitals on which they are based – need to be qualified or supplemented and that, above all, the European institutions and the Member States need to equip themselves with the necessary tools and resources to be able to implement them.

3.2.

Addressing the current major geopolitical and geo-economic risks and strengthening the resilience of the European economy, while also promoting the EU’s strategic objectives through the just green and digital transitions and fostering the productivity – and thereby the competitiveness – of its economies, is no easy task. It will be all the more difficult if it is has to be done, as is proposed by this Committee and in the discourse of the EU institutions, in a way that not only preserves social and territorial cohesion, but also makes it possible to bring about substantial improvements in areas such as poverty reduction and other aspects of the European Pillar of Social Rights, and to tackle the very serious problem of access to affordable housing for the population, especially young people.

3.3.

In order to make balanced progress towards these objectives, the EESC deems it essential to achieve greater political unity, opening up the prospect of greater European integration. Greater strategic autonomy, which is essential in areas such as security and defence, and the foreign policy needed to frame these, as well as industrial and trade policies, require an economic and fiscal policy for the euro area – and for the EU as a whole – that reflects the close coordination of the economic and fiscal policies of the Member States.

3.4.

Taking effective action in the area of economic policy in a challenging environment requires civil society to identify with the relevant objectives and to support the measures taken. One of the most worrying features of the situation is the growing influence of cultural and political currents that challenge democratic values and the validity of the EU project. In response to this, the EESC has always stressed the importance of ensuring real involvement of the social partners and European civil society organisations in economic governance, at both EU and Member State level. The Committee reiterates that its proposals on civil society involvement in the governance of the European semester (4) should be taken into account.

3.5.

Giving effect to the recommendations that the Commission proposes to the Council requires both a strong budgetary underpinning for public investment and measures to facilitate private investment. The restrictions that most Member States will face with respect to their public expenditure, resulting from the implementation of the national fiscal plans and the recommended neutral fiscal stance, may still be offset, in 2026, by the final implementation of the national recovery and resilience plans (NRRPs). The EESC believes that, given the public and private investment needs of the Member States, the EU cannot afford to let this opportunity go to waste, and therefore calls on the Commission and national governments to ensure all appropriations under the NRRPs are disbursed in full.

3.6.

The EESC acknowledges the efforts being made by governments to revise the NRRPs and facilitate their implementation. In its view, the revised plans should continue to meet the assessment criteria set out in the RRF Regulation as well as its social, green and digital objectives, and to avoid double financing. The Committee also believes that financial resources from programmes and projects that cannot be completed by August 2026 should be used for European public goods programmes. In order to ensure the smooth implementation of this final, simplified part of the RRF, the involvement of organised civil society must also be guaranteed.

3.7.

The EESC draws attention to the fact that some Member States, due to their improved fiscal situation, can take out loans with lower interest rates than those set for RRF loans. The Committee therefore calls for the financial cost of RRF appropriations to be reduced in such cases and/or, if this leads to the RRF loan not being used, for the same amount to be used to finance European projects.

3.8.

The first three recommendations relate to defence spending and the defence industry. Given the imperative of maintaining financial sustainability and complying with the net expenditure trajectories set out in the fiscal plans, it is striking that, despite the possibility of applying national escape clauses to finance defence expenditure, the autumn forecasts do not change their deficit projections for 2026 and 2027. An implicit recommendation could therefore be considered to exist, namely to redirect national budgetary expenditure towards defence or to increase tax revenues.

3.9.

The EESC has already expressed its support for increasing security and defence expenditure, strengthening the European defence industry and boosting joint procurement. The contents of the USA’s National Security Strategy make this all the more necessary, but also require it to be done with a view to building a common European defence pillar and a common European security and defence policy. This approach is yet to have been formally adopted.

3.10.

The EESC is concerned that giving priority to security and defence – with a specific mechanism to cover the related financing – in the context of the requirements of the national fiscal plans and the expenditure ceiling of the proposal for the 2028-2034 multiannual financial framework (MFF) will lead to underfinancing with respect to the objectives of the just green and digital transitions, social cohesion and bridging the EU’s investment gap vis-à-vis other advanced economies.

3.11.

The EESC believes that the main findings of the Letta and Draghi reports should be implemented promptly and in a coordinated and consistent way, in order to overcome all remaining barriers in the single market – thereby supporting recommendation (8) – and bridge the investment and productivity gaps, particularly as concerns the most advanced technologies, digital infrastructure and AI, which are key drivers of competitiveness gains. To this end, it proposes, among other measures:

(a)	creating a ‘Strategic Investment Fund’, to be financed through common European debt issuance, in order to fund investments in European common goods;

(b)	renewing programmes such as InvestEU and strengthening their capacity to lend to European businesses;

(c)	putting the full potential of the Savings and Investments Union at the service of business creation and financing without further delay (recommendation (10));

(d)

lowering the price of electricity by creating a genuine Energy Union, which will require the completion of the interconnection of Member States’ electricity grids and the expansion of clean and renewable energies, which not only are essential for achieving the objectives of the Green Deal, but are also cheaper. Financing these interconnections and renewable energy should be made priorities of the Strategic Investment Fund. This approach stands in logical contradiction to commitments to purchase fossil fuels, at high prices, from third countries;

(e)	renewing, promoting and strengthening European R&D&I programmes and linking them with national programmes, particularly in the area of the most advanced technologies. To this end, recommendation (7) needs to be developed and implemented using the necessary means;

(f)	strengthening and improving education, training and the development of human capital, in line with recommendation (5);

(g)	establishing regulatory frameworks that facilitate business creation and economic activity by removing superfluous barriers, while at the same time preserving labour and consumer rights and the requirements stemming from the just green and digital transitions.

3.12.

The EU has a surplus of savings over investment that results in savings being shifted abroad, in particular to the USA. Together with the Banking Union, the Capital Markets Union should be the main instrument for mobilising domestic savings in order to boost productive investment and innovation. The EESC believes that there is no justification for not completing the Capital Markets Union and the Banking Union once and for all, and therefore calls on the European institutions and the governments of the Member States to adopt, in 2026, all the decisions and legal instruments that will enable the full entry into force of both, with all their potential, in order to create the Savings and Investments Union.

3.13.

The EESC acknowledges the complexity of the ongoing ‘regulatory simplification’ process. Ensuring it is properly designed and implemented will help boost the factors promoting productivity and competitiveness mentioned in the previous point; however, it cannot replace them. On the other hand, good EU regulations provide added value for the EU economy and technological development; this is the case for the EU’s rules on digital markets and on AI, with the latter being pioneering and serving as a model globally. The EESC is therefore concerned about the pressure being exerted with a view to having these rules changed solely in order to preserve the monopoly positions of large digital service platforms and to serve their economic interests. The Committee therefore calls on the Commission and the other institutions to preserve the EU’s regulatory autonomy, without which the EU will cease to exist as the major positive political project it is. Regarding single market regulation, the EESC has expressed its support for removing the remaining barriers to completion of the single market as well as for establishing clear and easily enforceable rules that favour economic activity and technological innovation while at the same time respecting climate, social, labour and environmental objectives and consumer rights. The EESC has already expressed its concern that in some of the ongoing simplification processes, such as the one concerning the regulatory framework around sustainable finance (5), this balance could be broken in some respects.

3.14.

The EESC fully agrees with the Commission’s statement that combating tax evasion, tax avoidance and aggressive tax planning remains essential in order to ensure fair and efficient tax systems. It is therefore difficult to understand why the proposal on own resources under the next MFF should abolish the tax on digital services and, moreover, passively accept the G7’s decision (6) to exclude US multinational companies – and only US multinational companies – from the agreement under which multinationals have to pay a tax of at least 15 % on their profits, a compromise that was reached after many years of painstaking negotiations within the OECD.

3.15.

Access to decent housing is a fundamental right, which is essential for the empowerment of young people, for social and labour mobility and for the eradication of poverty, etc. There is a serious housing problem in a majority of EU Member States, especially for low-income sections of the population and among young people. The 2026 European Macroeconomic Report (7) identifies the lack of access to decent housing as one of the main vulnerabilities of the European economy, and the European Commission has just stated that affordable housing is a strategic objective. The EESC fully agrees with this and hopes that the announced European Affordable Housing Plan will be a powerful and effective tool to help Member States encourage public and private investment in housing construction and to put in place measures to facilitate access, especially to social housing. The expansion and renovation of the housing stock should go hand in hand with promoting sustainability. One of the problems needing to be addressed, in parallel, is labour shortages in the construction sector. In the EESC’s view, given the importance of the issue, a specific recommendation on this subject is required; the brief reference in recommendation (5) is not sufficient.

3.16.

The EESC welcomes the reference made in recommendation (6) to the role of the social partners and social dialogue in relation to the need for an increase in wages, in particular low and medium wages, while setting out certain conditions for this. In the EESC’s view, reference should also be made to collective bargaining, which is a tool that is distinct from social dialogue and should play a decisive role in setting wages.

3.17.

The EESC welcomes Bulgaria’s accession to the euro area, which shows the strength and potential of our common currency. The Committee fully agrees with recommendation (13) on promoting the role of the euro as a global reserve currency and on controlling risks to macro-financial stability. To move forward on the first point, as well as creating a digital euro (recommendation (12)), it will also be necessary to complete the Savings and Investments Union and to manage a sufficient and sustainable common European debt stock.

Brussels, 21 January 2026.

The President

of the European Economic and Social Committee

Séamus BOLAND

(1) Autumn 2025 Economic Forecast.

(2) Recommendation for a COUNCIL RECOMMENDATION on the economic policy of the euro area (COM(2025) 957 final).

(3) National Security Strategy of the United States of America, November 2025.

(4) As expressed in several opinions and resolutions, notably the Opinion of the European Economic and Social Committee on the EESC’s recommendations for a solid reform of the European Semester (own-initiative opinion) ( OJ C 228, 29.6.2023, p. 1).

(5) Opinion of the European Economic and Social Committee – A new impetus for the European sustainable finance framework (exploratory opinion requested by the Danish Presidency) (OJ C, C/2026/21, 16.1.2026, ELI: http://data.europa.eu/eli/C/2026/21/oj).

(6) G7 summit in Kananaskis, Alberta, Canada in June 2025, in which the EU participated as an observer.

(7) 2026 European Macroeconomic Report.

ELI: http://data.europa.eu/eli/C/2026/1961/oj

ISSN 1977-091X (electronic edition)

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