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COMPLETING AND REBALANCING THE ECONOMIC AND MONETARY UNION
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– A limited and strictly framed redemption of
certain existing public debts; in order to join
such a redemption scheme in the most or-
derly way, Member States could subscribe to
a “debt sustainability plan” lodged within
their national stability and growth pro-
gramme.
A progressive agenda of transformational
investment and socially balanced structural
reforms
In order to support stronger and truly sustaina-
ble growth by closing the output gap and by
achieving massive and quality employment cre-
ation in future years, the EU and the EMU must
develop a sustained and transformational in-
vestment policy at both European and national
levels.
Some positive progress is now being made in
this direction through the forthcoming European
Fund for Strategic Investment (EFSI) and through
the recent Commission communication on
making the best use of flexibility within the ex-
isting rules of the Stability and Growth Pact.
However, these solutions will not on their
own fill Europe’s investment gap. Investment
required in coming years is estimated at around
1.5 trillion euros just up to 2020 in particular on
infrastructure and network systems in transport,
energy and broadband, in order to shift Europe’s
economy towards a new sustainable and com-
petitive growth model. Significant additional
social investment will be required in conjunc-
tion, notably in the field of education, vocation-
al training and lifelong learning systems, includ-
ing in digital skills and new growth areas.
Attaining such high levels of investment will
demand a major and sustained increase in both
national private and public investment levels
across good and bad economic times, beyond
the current capacity of the EFSI. This should be
more adequately coordinated at EMU and
European levels, in order to guide national pub-
lic investment flows sufficiently towards
European objectives, and to foster synergies
and exploit positive spill-overs. Beyond the me-
dium term, as detailed in section 2.5, an EMU
fiscal capacity, including a borrowing facility,
could further complement European invest-
ment, as an addition to, or integrated into, an
evolved EFSI.
The forthcoming mid-term review of the
Europe 2020 Strategy should contribute to the
EMU completion process by helping to refocus
structural reforms from labour cost- cutting to
competitiveness based on factors such as inno-
vation, resource efficiency, sustainable re-indus-
trialisation, a well-functioning Single Market
and social cohesion. It should also emphasise
the link between growth-enhancing structural
reforms and investments. The 2016 National
Reform Programmes should clearly identify
through which reforms and through which
budgetary resources each of the national Europe
2020 targets is to be achieved.
A more progressive, socially balanced, agen-
da of structural reforms should encompass
measures such as decisive shift of taxation away
from labour to wealth and pollution; stronger
employment and social policies that empower
people, including more women, to productively
participate in the economy and society, fight
against tax avoidance through significantly im-
proved transparency, notably ensuring that na-
tional tax policies and cooperation among tax
authorities is in full line with the principle of
sincere cooperation; strategies for innovative
and sustainable re-industrialisation; and im-
provements in education and training systems,
notably in new growth areas such as the Digital