The commission presented its country-specific recommendations as part of the economic spring package. In 2022, the debt ratio of public finances decreased in all member states except Finland.
BRUSSELS The Commission pays special attention to the sixteen member countries with a deficit of more than three percent or where the public debt exceeds the reference value of 60 percent.
Public debt exceeded the limit allowed by the EU in thirteen member states. Three of these countries – France, Italy and Finland – did not comply with the debt reduction reference value agreed in the EU.
Compared to the previous year, the debt ratio of public finances decreased in all member states except Finland, the commission states in its report.
Vice-president responsible for financial issues of the Commission Valdis Dombrovskis emphasizes that the economic situation of the member countries does not give rise to an excessive deficit procedure at this stage.
The excessive deficit procedure directs member countries to reduce their public debt and deficit. In extreme cases, breaking the rules can lead to fines.
EU countries are allowed to deviate from the rules of the Growth and Stability Pact citing the corona crisis and the war in Ukraine. However, stricter measures may be in store in 2024, when the EU returns to more conventional economic management.
– Member countries should take this into account when implementing their budgets for this year and when preparing the budget for next year, Dombrovskis warned.
Four national recommendations for Finland
The commission also released the 2023 country reports, which outline actions to address economic and social challenges.
The Commission proposes the following four measures for Finland to improve the economic situation.
1. Finland must cancel the existing energy subsidies by the end of the year in order to achieve public finance savings. The Commission encourages Finland to pursue a prudent fiscal policy and to utilize EU funds to promote the green transition and digitization. Social security must be enhanced and the acceptance of work must be encouraged.
2. Finland must continue implementing its recovery plan and utilize EU funds to strengthen recovery and resilience.
3. Finland must fix the labor and skills shortage investing in retraining and improving the supply of higher education in in-demand fields.
4. Finland must reduce its dependence on fossil fuels and accelerate the use of renewable energy sources. The Commission hopes that Finland will improve licensing procedures to facilitate public and private investments.