Jaume Duch, spokesperson of the European Parliament: The European economy needs a boost, it is not only a matter of prosperity but also of securityTo make the EU more stable, we need to address our dependencies on countries outside the Union
Mr Duch, what are the most important legislative files, which EP voted on since the beginning of the year?
To help Members States in the path towards climate neutrality, Parliament has adopted most of the new laws of the so-called "Fit for 55 package" to reduce greenhouse gas emissions, which include for example, stricter CO2 emission standards for all transport means including cars and the Social Climate Fund to help households, micro-businesses and transport users cope with the additional costs of the green transition. Furthermore, MEPs ensured that supply chains do not cause further deforestation, that batteries are largely recycled and energy efficiency of products increase. Parliament quickly adopted "RePowerEU" rules that gave immediate access to "Next Generation EU" funding for member states and communities to reduce their dependency on fossil fuel.
The Parliament also set out legislation for a fairer and safer digital world, with the Digital Services Act and Digital Markets Act, and is finalising, together with member states, the world’s first rules on Artificial Intelligence, a common framework to ensure a human-centric and ethical development of AI. Still on digitalisation, the Data Act that will regulate how our data generated by the use of connected products or related services is shared while fully respecting consumers' privacy. Parliament also refined rules for political advertising to make elections more transparent and resistant to interference; furthermore anti-money-laundering measures and a regulation on crypto assets have been agreed to tackle financial crime.
To boost our industrial competitiveness, MEPs swiftly approved a new strategy to secure the supply of semiconductors and chips in the EU and are committed to anchor and re-locate industrial production capacities in Europe, be it through dedicated funds to decrease their carbon footprint, switch to renewable energies or get access to innovative technologies and rare raw materials. Still for businesses, new legislation will require EU companies to disclose information that makes it easier for employees to compare salaries and to expose existing gender pay gaps.
From the first days of the Russian aggression, the European Parliament has voiced unwavering support for Ukraine, pushed for sanctions and a special tribunal to punish Russian crimes while advocating swift democratic reforms for Ukraine to join the EU. In 2022, MEPs also approved to simplify rules on the usage of EU regional funds to help neighbouring regions on Ukraine borders. Within short, MEPs will adopt a proposal in fast-track procedure to increase European capacities of providing ammunition to Ukraine to defend its sovereign territory and look into ways to provide not only humanitarian but also reconstruction aid to the country. There are many more examples but these are probably the most relevant ones.
The EU is facing many crises that we haven't seen in decades, but every crisis is also an opportunity. What steps are needed to make the Union more stable after them?
In order to make the European Union more stable we need to tackle our dependencies from others. We need to stop relaying on the United States for security, on Russia, on access to energy, on China and on other countries for semiconductors or raw materials. We need to halt as much as possible the industrial depopulation of the EU and achieve strategic autonomy in dealing with major geopolitical issues. Achieving the strategic autonomy means putting in place a very complex plan, in which all the pieces must fit together.
We need an industrial policy that makes us competitive without breaking the internal market and that follows the path of the climate targets and maintains the industrial competitiveness of European companies. While at the same time, we need as a matter of urgency to boost EU investment in defence and innovative technologies to continue building a true Security and Defence Union.
Our economy needs a boost, and it is not only a matter of prosperity, but also a matter of security. That means looking again at the EU Budget. The EU Budget lacks the resources and flexibility to respond to crises or to finance new priorities. This topic is currently under discussion, as MEPs are set to vote in plenary on the interim report on the EU Budget revision in October. We need a revision to adapt to the emerging needs and priorities, be it humanitarian aid to and reconstruction of Ukraine, dealing with the natural disasters, and financing our policy ambitions on climate, energy, defence and strategic autonomy.
One very important topic affecting the construction sector is that over 35 million buildings need to be renovated in the coming years. A very ambitious goal, what is the EP’s opinion on this? Where will the funding come from?
Buildings are responsible for 40% of our energy consumption and 36% of greenhouse gas emissions in the EU. The aim of the revised Energy Performance of Buildings Directive is to substantially reduce these, which indeed would mean increasing renovations of energy-inefficient buildings and improve their energy performance. The investments foreseen by the legislation also aim to pay off financially for owners in the long run, as they will allow for energy savings.
According to the text adopted by MEPs, all new buildings should to be zero-emission from 2028 and the ones operated or owned by public authorities in 2026. New structures should also be equipped with solar technologies by 2028, while residential buildings undergoing major renovation would have until 2032.
It is important to note that EU countries will have the flexibility to design their national renovation plans, as they face very different situations from one another. The new rules would not affect monuments, and EU countries will be free to decide to exclude buildings that are protected due to their special architectural or historical merit, technical buildings, public social housing or places of worship.
At EU level, several funding streams can be used for financing buildings renovations. Among the most important are the European Structural and Investment Funds (ESIF), the European Fund for Strategic Investments (EFSI), Horizon Europe, the ELENA facility and the Social Climate Fund that will help cope with the additional costs of the green transition. More financial instruments will be developed between 2021 and 2027 under InvestEU program.
At national level the funding for the renovations should come from the national renovation plans drafted by member states where support schemes to facilitate access to grants and funding are included.
With the Parliament’s position clear, MEPs will negotiate with Member States on the final shape of the bill.
What are the EP’s forecasts about how the Union can cope with rising inflation?
The rising cost of living is currently the most pressing concern for 9 out of 10 Europeans. High inflation has hit our entire economy, but it particularly hurt the most exposed, vulnerable and unprivileged households.
While economic growth slowed drastically towards the end of 2022, inflation rates have slowed down as well but at unprecedentedly high levels. This is still substantially above the 2% inflation target set by the European Central Bank.
To bring inflation down to the target of 2%, the European Central Bank started the process of policy normalisation. Which practically means increasing interest rates leading to tighter financing conditions and over time this lowers the demand for goods and services in the economy.
Recent estimates show that the interest rate hikes could lower inflation by 1.8 percentage points in 2024. The negative impact on real GDP growth is estimated to be around 1.5% on average over three years.
Monetary policy works with a time lag, monitoring tightening in the Eurozone is expected to have its highest impact with a lack of two years. This is important to consider as further interest rate hikes in the coming months are likely.
In any case, the inflation outlook is heavily influenced by the political uncertainties. Thus, the ECB is walking a tightrope to calibrate monetary policy. On one hand, it has to ensure that inflation gets back to the 2% charge, on the other hand, flexibility is also key to avoid overtightening and to ensure that the cost for economy and to the people are minimal.
There will be new European elections in 2024. What will the EP do to get people to vote and understand the importance of giving their vote in elections?
These volatile times and the several crisis that have profoundly transformed the EU these past years underline just how important all elections are and it seems that every European Elections are more important than the previous.
The European elections lay the foundations for what is to come. The same reasons that are valid for voting in national, regional or municipal elections are valid for the European elections.
The strategy we are designing is two-fold: to inform and engage as many citizens as possible about the elections, why voting at the European elections is important and when they take place.
We will inform, on the one hand, about what the European Parliament does, what it has been doing during this legislature and what are the challenges or issues that remain on the table for the next one. We will do our best, but we can’t do that alone. We are opening the Parliament to all kinds of media and increasingly to all kinds of people who have influence in the networks.
Every layer of government has an impact on our everyday lives and every set of elected representatives are accountable to the people who elect them.
That is why, we will try to mobilise citizens by encouraging them to flee abstentionism. Their vote is very important and we all need take root in the democratic DNA of the European Union.
Voting isn’t just the most important tool at the disposal of citizens to choose their future and influence the future shape of Europe. Voting is also a way of safeguarding democracy.
If you cast your eyes around Europe today you will see plenty of examples of how democracy is being challenged. Internally and externally. The most important protection we have of our freedoms is the guarantee of elections every few years, at local, regional, national and European level, where our elected representatives are chosen - by everyone, equally and fairly.
What is the opinion of the EP regarding Bulgaria’s membership in Schengen and the euro area?
This past June, MEPs called again to approve the accession of Romania and Bulgaria to the Schengen free-travel area by the end of 2023.
The European Parliament believes that in recent years Bulgarians have made all the progress in the technical and legal field that is necessary to obtain the right to open the borders and participate in the Schengen area. It is regrettable that today there are still governments in certain countries that, at the level of the Council of the EU, block Bulgaria's accession to Schengen. Unfortunately, this is not a decision to be taken by Parliament.
The will of the EP is clear, Parliament has adopted several resolutions in favour of Bulgaria’s accession, but it doesn't just depend on us, It is up to the Council.
What are the priorities of the European Parliament by the end of the year?
For the months left of the 9th legislature, EP's main priority is to ensure European leadership in clean energy technologies, reform the electricity market and further strengthen Europe's industrial base, as an enabler to provide quality jobs and economic growth to achieve the objectives of the Green Deal. In this respect, EP will ensure an industrial policy for EU companies to become even more competitive on global markets. To meet these objectives the European Parliament will also centre its work on reviewing the current long term Budget of the EU called, the Multiannual Financial Framework (MFF).
Alongside these priorities, there are some older legislative proposals still under discussion with member states, the most important and sensitive being the migration and asylum pact. It is essential to conclude this package of new rules before the end of the current legislature. The lack of political will on the part of some member states made it impossible to approve the measures proposed and negotiated during the previous legislature, under the pressure of the Syrian crisis. Five years later, the ball is back in the Council's court.