Remarks by Executive Vice-President Mînzatu and Commissioner Dombrovskis at the press conference presenting the European Semester Spring Package

Executive Vice-President Mînzatu

This Spring Package comes as the world is navigating a very complex economic and geopolitical environment.

Europe is facing pressure from outside, but our answer must be to strengthen resilience from within.

Let me just mention two relevant data sets:

• Due to the war in Middle East, up to 1.3 million jobs in Europe are at risk – especially in energy intensive industries.
• At the same time, 77% of the companies indicate skills shortages as the main barrier for investments.

Such situations are reflected in the findings of our Social Convergence Framework. Compared to last year, three more Member States are facing risks of social imbalances.

Competitiveness that leaves social imbalances behind is not sustainable competitiveness.

In this context, we have three main priorities in our Employment Guidelines, and they are also reflected in the recommendations we are addressing to Member States.

Our response is simple: invest in people, improve work, and protect living standards.

First: Human Capital – or to put it simply, investing in people. Because we cannot deliver on any of our goals as a Union without people with the right skills, in the right place, at the right time.

Skills are not a social add-on to competitiveness. Skills are competitiveness!

In a nutshell, that is what the Union of Skills is all about.

Second: Labour shortages due to poor working conditions. Because we cannot attract talents, reduce shortages and improve people's earnings without good working conditions.

Third: Tackling the cost-of-living crisis. For this, I remind everyone of the Anti-Poverty Strategy presented just a month ago.

These three priorities all reinforce each other: better skills lead to higher quality jobs, and quality jobs are the best way out of poverty.

This is the circle we need: better skills, better jobs, better lives.

And allow me to underline the human capital perspective, as it is the main novelty of this Semester cycle.

This Semester marks a monumental shift: we are looking at competitiveness through the lens of people.

In the Autumn Package, we put forward for the first time an EU-wide

Recommendation on Human Capital.

This time, we looked at where Europe needs to step up collectively to raise skills levels across the Union — especially in the strategic sectors that will define our competitiveness.

We focused on six key areas: basic skills, STEM, vocational education and training, teachers, skills portability, and skills intelligence.

And we then applied this same lens to each Member State. We identified where each country should focus its efforts, and translated that analysis into recommendations adapted to its specific challenges.

For instance:

• 15 Member States received recommendations on STEM – you know how important it is for our industry that we have more science, technology, engineering and math talent.
• 10 Member States received recommendations on VET – you know the biggest labour shortages are in occupations which need vocational training.
• And 4 Member States received recommendations on skills intelligence systems – because without proper data we cannot tailor our policies.
• We are not issuing one-size-fits-all advice. We are identifying where each Member State can make the biggest difference.

Speaking of data, the Commission has set up a European Skills Intelligence Observatory to gather and analyse data on skills supply, demand and matching from different sources, so that we can better identify where skills gaps are emerging and where policy action is most needed.

• While the public launch of the Observatory is planned for 2027, the research work has started and already gave an input to the work of the High-Level Skills Board.

So with this Semester, we are making a clear statement: people – their skills, their jobs, their living standards – matter enormously for our competitiveness.

My message to Member States is: we need to strengthen our policies. We are here to support and work together.

In the end, Europe's strongest asset is not only its single market, its industry, or its technology. It is its people.

And a Europe that invests in its people is a Europe that will out-compete, out-innovate, and out-last any challenge thrown at it.

That is what this Semester is about. And that is what we will keep fighting for, now with a more people-oriented approach.

Thank you.

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Commissioner Dombrovskis

Thank you. Good afternoon, everyone.

The European Commission is presenting the European Semester 2026 Spring Package at a moment of profound geopolitical uncertainty and intensifying global competition.

The European economy continues to demonstrate resilience as it navigates one crisis after another.

But there remains an urgent need for Europe to act to enhance its competitiveness.

This is essential to secure our long-term prosperity and preserve our strategic autonomy.

The price of failing to act is simply too high: a diminished Europe, shaped by global events rather than shaping them.

It is a future we should be unwilling to accept.

This project is a shared responsibility of EU institutions and Member States alike.

Success demands that we all move in the same direction. And move urgently.

That's why this year's recommendations to Member States target strengthening Europe's competitiveness.

They broadly fall in four categories:

Firstly, ensuring fiscal stability.

They include recommendations on stepping up the use of spending reviews, reforms of the taxation systems and measures to improve the long-term sustainability of care and pension systems.

Secondly, closing the innovation gap and improving the business environment. 

These cover simplifying the regulatory framework, improving access to finance and lowering single market barriers.

Thirdly, energy security and affordability.

This entails strengthening grid capacity and energy storage to enhance energy security.

And fourthly, and Roxana will speak more about this, strengthening people's education and skills while improving social fairness.

In some cases, the recommendations also tackle housing affordability challenges, factoring in the regional dimension.

And finally, our recommendations also acknowledge the unique challenges faced by our Eastern border regions.

The Member States directly concerned have received recommendations focused on addressing their socio-economic, preparedness and security challenges.

The Commission calls on Member States to translate today's recommendations into policy action without delay.

This brings me to the fiscal aspects of today's package.

Sound public finances are a vital asset for preserving macroeconomic stability in an increasingly unpredictable and challenging world.

We must be careful to safeguard them in a context of persistently high debt in a number of Member States and new and urgent demands on our public finances.

The Spring Package also takes into account the impact of the energy shock resulting from the conflict in the Middle East.

We continue to insist that any measures to support households and businesses must be temporary, targeted, timely and should not increase the aggregate demand for fossil fuels.

Moreover, we have decided that measures to strengthen the structural resilience of the European energy system and accelerate the transition away from fossil fuels may benefit from the existing flexibility within the fiscal framework. 

Upon request by a Member State, the scope of the current National Escape Clause for defence can be broadened.

Within the existing cap of 1.5% of GDP, a dedicated annual cap of 0.3% of GDP could apply specifically for these energy support measures.

This would be available for the period 2026 to 2028, with a cumulative cap of 0.6% of GDP.

For those few Member States that have already used full flexibility under the national escape clause to increase defence spending, this would allow them to move beyond 1.5% of GDP subject to an additional sustainability assessment.

Looking ahead, our recommendations call on Member States to remain in line with fiscal requirements under their medium-term plans or the excessive deficit procedure, and to enhance the quality and efficiency of public spending.

We also assessed Member States' compliance with EU fiscal rules.

All ten Member States currently subject to the excessive deficit procedure took effective action last year.

That means that no further steps need to be taken under the excessive deficit procedure at this stage.

However, for Hungary, the net expenditure growth rate is projected to be at risk of material non-compliance with the Council's recommendations this year.

This entails a clear risk of no effective action for this year and could require a stepping up of its excessive deficit procedure at a later stage.

The Commission will monitor this situation closely and reassess it in autumn.

Then, Malta reduced its general government deficit below 3% of GDP in 2025 and it is projected to remain below 3% of GDP both this year and next.

The Commission is therefore recommending ending Malta's excessive deficit procedure.

At the same time, several Member States recorded a deficit above 3% of GDP last year.

The Commission assessed the compliance of these Member States with the Treaty's deficit criterion.

It concluded that there is no case to open an excessive deficit procedure for Germany, Estonia, Latvia, and Slovenia. 

For Bulgaria, the budget  deficit last year was not exceeding 3% of GDP when taking into account additional defence spending under the national escape clause.

However, as of this year, the excess over 3% of GDP is no longer explained by additional defence spending.

Therefore, the report concludes that the deficit criterion is not complied with.

The next step is for the Economic and Financial Committee to formulate an opinion on this assessment.

And the Commission will then propose to open an excessive deficit procedure for Bulgaria.

The Commission will continue to closely monitor fiscal developments in the coming months.

We will return to our assessment of compliance for all Member States in the European Semester Autumn Package.

A final word on the findings of the macroeconomic imbalances procedure.

Seven Member States were selected to undergo in-depth reviews on the basis of our Alert Mechanism Report.

The report identifies those Member States potentially experiencing economic imbalances.

Our classification of imbalances is based on three criteria: their gravity, evolution, and policy responses.

Our assessment finds that:

Three Member States – Greece, the Netherlands, and Sweden – are no longer experiencing imbalances.

Three Member States – Italy, Hungary, and Slovakia – are experiencing imbalances.

And one Member State – Romania – continues to experience excessive imbalances.

To conclude, the path forward is clear.

Advancing our competitiveness agenda and maintaining fiscal sustainability go hand-in-hand.

Both are essential to securing Europe's long-term prosperity, resilience, and sovereignty.

The work ahead, as laid out in today's recommendations, will require determined efforts.

The Commission stands ready to support Member States in delivering this essential agenda.

Thank you.