Brussels: Europe and the Arabs

At the conclusion of the meetings of finance and economy ministers of the European Union, the current rotating presidency of the Union, held by Cyprus, addressed the issue of the Savings and Investment Union. According to a European statement issued in Brussels, Makis Keravnos, Minister of Finance of the Republic of Cyprus and chair of the meeting, said, "From the outset, the Cypriot presidency has made enhancing Europe's competitiveness a key pillar of its agenda. As demonstrated by the meeting of EU leaders last week, this political momentum is shared by the member states. The Savings and Investment Union, including the pension package we discussed today, are key instruments for boosting capital flows and helping us achieve a strong, innovative, and economically prosperous Europe." The European statement added, "Ministers exchanged views on the supplementary pension package, a key component of the Savings and Investment Union. This package aims to improve retirement incomes for citizens while strengthening the competitiveness of the European Union. More specifically, the package amends the European Universal Personal Pension Product (PEPP) regulation and the Institutional Directive on Occupational Retirement Provisions. This reform will make supplementary pensions more attractive and accessible to EU citizens, while simultaneously contributing to the financing of the economy. During their discussion, ministers expressed their general support for the Commission's proposals to improve the EU supplementary pension framework. They highlighted in particular the potential of this package to ensure adequate retirement for EU citizens, mobilize long-term private savings that can help boost investment in the EU, and support the overall sustainability of the economy. At the same time, ministers stressed the need to respect the competencies of Member States, particularly in the areas of social and labor law. They also emphasized the need to consider proportionality for smaller market players and requested clarification on the proposed inclusion in national frameworks." Regarding the non-discriminatory tax treatment of emergency pension schemes.

Work on this package will continue at both the technical and political levels. The Cypriot Presidency will seek common ground, taking into account the considerable diversity of national pension systems among Member States.

Defense Financing
The Council decided to activate the National Economic Clause (NEC) under the Stability and Growth Pact (SGP) for Austria. This measure will help Austria transition to increased national defense spending while ensuring debt sustainability.

The National Economic Clause (NEC) allows Member States to temporarily deviate from budgetary requirements in response to exceptional circumstances beyond their control, while ensuring debt sustainability. Member States can thus record larger deficits without this being considered a breach of the fiscal rules set out in the Stability and Growth Pact (SGP).

This clause covers a four-year period and has a maximum flexibility limit of 1.5% of GDP. Today’s decision brings the number of EU Member States that have invoked the National Economic Clause to increase their national defense spending to 17.

EU List of Non-Cooperative Jurisdictions
The Council decided, under Clause The addition of two more countries – Turks and Caicos Islands and Vietnam – to the EU's list of non-cooperative jurisdictions for tax purposes was not up for discussion.

This list is an EU tool, part of its efforts to promote good tax governance globally. It includes countries that do not comply with agreed international tax standards or have not met their good tax governance commitments within a defined timeframe.

The Council also removed three countries – Fiji, Samoa, and Trinidad and Tobago – from the list. These countries now meet all the required criteria for this process.

Following today's update, the list now includes ten countries:

American Samoa
Anguilla
Guam
Palau
Panama
Russia
Turks and Caicos Islands
U.S. Virgin Islands
Vanuatu
Vietnam
The Council also approved the usual status quo document (Annex II), which reflects the EU's ongoing cooperation with its international partners and these countries' commitments to reform their legislation in line with agreed good tax governance standards.

The Council also approved the 2026 Recommendation on Eurozone Economic Policy

The recommendation addresses key issues relating to the functioning of the eurozone and aims to improve the integration of the national and eurozone dimensions of EU economic governance.

The European Council will be invited to endorse the recommendation at its meeting scheduled for March. Following this, the Council will be able to proceed with its formal adoption.

EU Budget
The Council adopted its guidelines for the EU's 2027 annual budget, which provide policy guidance to the Commission in preparing its draft budget proposal for next year. This will be the final annual budget cycle under the EU's Multiannual Financial Framework (MFF) for 2021-2027.

Among other considerations, the Council's guidelines emphasize that the 2027 budget must be realistic, aligned with actual needs, ensure efficient spending, and leave sufficient margins within the MFF ceilings to address unforeseen circumstances and challenges facing the EU.

The Council also adopted a recommendation on the discharge to be submitted to the Commission for the implementation of the EU's general budget for 2024. Referring it to the European Parliament.