Week Ahead (4 October)
Monday, 4 October - Eurogroup to discuss 11th Surveillance Report on the Greek economy
The Eurogroup of Eurozone finance ministers will meet today to discuss inter alia the latest enhanced surveillance report on the Greek economy. The report, issued on 22 September, discusses the progress made in implementing reform commitments delivered by Greece under the European Stability Mechanism programme in June 2018. Where sufficient progress has been made the Greek government will be eligible for debt-relief measures, although Greece will not be able to avail of these measures until after the 12th surveillance report, scheduled for November.
The most recent report provided a positive update on the Greek recovery, noting a 4.5% and 3.4% increase on GDP on a quarter-by-quarter basis in the first and second quarters of 2021, despite a later than planned reopening of the economy after the pandemic.
W/C Monday, 4 October - Irish government to consider backing OECD agreement on global minimum corporation tax rate
The Irish Minister for Finance, Paschal Donohoe, has said that the Irish government may make a decision on whether it will back the OECD-level agreement on minimum taxation for corporates this week. Ireland has come under pressure to sign up to the deal, which would impose a minimum corporate tax level of 15% across the globe. As a reminder, Ireland's corporation tax rate has stood at 12.5% since 2003 and is widely seen as an important factor in the decision of many multinational companies to set up in the country.
Speaking on national radio last week, Donohoe said that the Government was waiting for a revised proposal from the OECD. Ireland is keen to ensure certainty about potential future increases in the rate of the proposed tax. To that end, it wants the text of the agreement amended to read "15%" rather than "at least" 15%, which it regards as a reference to future increases.
Tuesday, 5 October - ECOFIN to discuss latest recovery and resilience fund roll-out
The Economic and Financial Affairs Council will meet on Tuesday. On the agenda is an update on the roll-out of the Recovery and Resilience Facility as member states begin to put their spending plans into action. The Council is likely to sign off on Malta's plan, which has been approved by the Commission already, during the meeting. 18 Member States have now been approved by the Commission and the Council.
Last week the Commission introduced secondary legislation outlining how member states should report on their progress in implementing agreed spending and reforms under their individual recovery plans. In order to access future tranches of funding, member states will be required to report twice a year on milestones reached, detailing how much money they have spent and what it has been spent on. The European Parliament and Council have two months in which to raise objections to the proposed methodology; in the absence of objections it will become operational at the beginning of December.
Wednesday, 6 October - European Parliament debate on recovery plans ahead of Polish Court ruling on whether EU law has precedence over the Polish constitution
The European Parliament will hold a plenary debate on Wednesday on recovery plans which have yet to be approved by the Commission. The debate will focus on Hungary and Poland, and is being held on foot of a request from the liberal Renew group, whose leader, Dacian Cioloş MEP, said last week that the Commission should use its clout to "force Orbán to fix Hungary's most egregious corruption problem". A deadline for a decision on the country's access to European funds passed last week.
The recovery plans of Hungary and Poland are yet to be approved by the European Commission, which has concerns over rule of law conditions in both countries.
In Poland, meanwhile, a Constitutional Tribunal is due to make a ruling on Thursday on whether EU law has precedence over the Polish constitution. In June the Constitutional Court ruled that measures imposed by the European Court of Justice in relation to Polish judicial reforms were ultra vires, raising serious questions about Poland’s future in the EU as it challenges the core EU value of the supremacy of EU law over the domestic laws in place in member states.