Communication: Annual growth survey 2017

The Annual Growth Survey 2017 outlines the most pressing economic and social priorities on which the European Union and its Member States need to focus their attention in the coming months. The President’s State of the Union address of 14 September 2016 underlined the need for Europe to strengthen its economic recovery and invest strongly in its youth and jobseekers, as well as in its start-ups and SMEs. The Letter of Intent signed by the President and the First Vice-President on the same day, and addressed to the Presidents of the European Parliament and of the Council, highlights the need to achieve an economic recovery which benefits all, notably the weaker parts of our societies, and strengthens fairness and the social dimension of our single market. It identifies a number of ways in which we can create more jobs, growth and investment for the Union, which is the number one priority of the Commission. Ensuring a promising economic future for all, safeguarding our way of life and providing better opportunities for young people were also highlighted as priorities in the Bratislava roadmap endorsed by the Heads of State or Government of 27 Member States on 16 September 2016.

The policy guidance provided in this Annual Growth Survey is accompanied by a specific recommendation for a Council recommendation on the economic policy for the euro area, a Communication on a positive fiscal stance for the euro area, and a thorough analysis of economic and labour market and social conditions. It builds on the economic policy strategy of the virtuous triangle of investment, structural reforms and responsible public finances, which this Commission has pursued since the start of its mandate, as part of its overall agenda for jobs, growth, fairness and democratic change. It has also benefited from discussions in the European Parliament, the Council and the other EU institutions following the State of the Union Address. Moreover, the views expressed by social partners in the established dialogues have also been taken into account.

There are a number of positive developments in the EU, signalling the resilience and recovery of the European economy, despite the broader uncertainty worldwide. All Member States are growing again. Investment has started to pick up. 8 million new jobs have been created since 2013. The employment rate has also increased. If current trends continue, the Europe 2020 employment rate target of 75% could in fact be reached. The rise in activity rates over the years, in spite of the crisis, is a further testimony of structural improvements in the performance of labour markets. The average public deficit level, which was over 6% for the euro area a few years ago, is below 2% this year and will continue to reduce. Levels of government debt have stabilised and are expected to decrease.

However, there is no scope for complacency as the recovery remains fragile. Growth, employment and investment are still held back by legacies inherited from the crisis, as well as by structural deficiencies dating back to the pre-crisis years. Despite recent improvements, unemployment remains far too high in many parts of Europe and the prolonged period of high unemployment is taking its social toll on many Member States. Moreover, GDP and productivity growth rates remain below full potential and investment levels remain below pre-crisis levels. Furthermore, there are still significant imbalances and broader risks within the euro area and the EU more generally, with convergence among and within the Member States stalled in many cases.

ESO: Background information: Launch of the 2017 European Semester http://www.europeansources.info/record/launch-of-the-2017-european-semester/

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