The Commission is setting up a new Climate City Capital Hub, an international finance resource to further support cities participating in the EU Mission on Climate-Neutral and Smart Cities.
Thanks to the new hub, cities that have already received the EU Cities Mission Label will be able to:

Access financial advice in cooperation with advisory services of the European Investment Bank (EIB);
Structure their financial needs so they understand various ways of funding projects, including pooling of projects; and
Introduce projects to a range of capital providers, including lenders and investors from the public and private sectors (such as philanthropic and corporate capital, as well as innovative financing like crowdfunding and sustainability-linked bonds), and support the process to deal closure.

Complementing EIB services, the Climate City Capital Hub will be created with the support of both the EU Mission on Climate-Neutral and Smart Cities Mission and the EU Mission on Adaptation to Climate Change. Its particular focus will be on engagement with private capital. For cities that signed both the Charter of the Mission on Climate Adaptation and have received the EU Cities Mission Label, the services will cover both mitigation and adaptation projects, taking a holistic approach to tackle climate change.
The hub will be run by the Commission’s Cities Mission implementation platform, which is currently managed by the project NetZeroCities. The Commission announced its creation at the 2024 Cities Mission conference held in Valencia on 25 and 26 June.
In addition, the EIB has earmarked a lending envelope of €2 billion dedicated to cities with the Cities Mission Label to support their plans to invest in energy, efficient buildings, district heating systems, renewable energy, sustainable mobility, urban renewal and regeneration, water and social infrastructure. It reinforces the EIB support to labelled cities and adds a dedicated finance facility to advisory services.
Next Steps
So far, 33 cities have been awarded the Label of the EU Mission for Climate-Neutral and Smart Cities: 10 in October 2023 and 23 in March 2024. The label is an important milestone in the cities’ work. It acknowledges successful development of Climate City Contracts, which outline the cities’ overall vision for climate neutrality and contain an action plan as well as an investment plan. Cities co-create their Climate City Contracts with local stakeholders including the private sector and citizens. From the 33 Investment Plans that have been submitted so far, approximately €114.1 billion have been budgeted for climate actions – on average €3.6 billion per city. Currently, the Commission is reviewing another 23 Climate City Contracts.
In parallel, the EU Mission for Climate-Neutral and Smart Cities has also collected more than 200 solutions that will help cities on their way to climate neutrality. The solutions cover from A – “Advanced Renovation Support” to Z – “Zero Emission Buses” and can be found in the Knowledge Repository.
Background
Cities account for more than 70% of global CO₂ emissions and consume over 65% of the world’s energy. Urban action is crucial for climate mitigation and can contribute significantly to accelerating the efforts to achieve the legally binding commitment to achieve climate-neutrality in the EU as a whole by 2050, as well as to the EU’s target of reducing greenhouse gas emissions by 55% by 2030 and more generally delivering the European Green Deal. The EU Cities Mission aims to help European cities become climate-neutral, offering cleaner air, safer transport and less congestion and noise to their citizens.
In April 2022, 100 cities in the EU and 12 cities in countries associated to Horizon Europe, the EU research and innovation programme, were selected to participate in the Mission. They are testing innovative cross-sectoral approaches including for citizen engagement, stakeholder management and internal governance to accelerate their path to climate neutrality. This makes them experimentation and innovation hubs to enable all European cities to follow suit by 2050.
For more information, please contact:

Thomas Regnier, Spokesperson

Roberta Verbanac, Press Officer

 
 
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Biennial report assesses progress towards euro adoption in Bulgaria, Czech Republic, Hungary, Poland, Romania and Sweden
Inflation above reference value seen as key economic obstacle in central and eastern European countries under review
Legislation in five of six countries under review not fully compatible with legal requirements for euro adoption
Economic activity expected to strengthen in 2024, but outlook clouded by geopolitical uncertainty

Limited progress has been made by non-euro area Member States of the European Union (EU) on economic convergence with the euro area since 2022, according to the 2024 Convergence Report of the European Central Bank (ECB). This is mainly due to challenging economic conditions.
Over the past two years, the countries under review have been hit by the fallout from Russia’s invasion of Ukraine, which led to a significant weakening of economic activity and soaring inflation. Countries with a history of higher energy dependence on and stronger trade links with Russia were the most affected. Looking ahead, economic activity is expected to strengthen in all of the countries under review, but geopolitical tensions and risks are clouding economic prospects.
As regards the price stability criterion, five of the countries under review – Bulgaria, the Czech Republic, Hungary, Poland and Romania – recorded average inflation rates well above the reference value of 3.3%, while inflation was slightly above the reference value in Sweden (Chart 1). The reference value is based on the three best-performing Member States over the past 12 months, i.e. Denmark (1.1%), Belgium (1.9%) and the Netherlands (2.5%), taking their average inflation rates over the past 12 months and adding 1½ percentage points. One outlier, Finland, was excluded from this calculation.
Chart 1
HICP inflation
(average annual percentage changes)Source: Eurostat.
Chart 2
General government surplus (+) or deficit (-)
(percentages of GDP)Source: Eurostat.
The fiscal deficit in 2023 improved compared with its 2021 level in four of the countries covered in this report, owing to the post-pandemic economic recovery and the phasing-out of fiscal support measures. However, this improvement was in part curbed by the economic impact of Russia’s war against Ukraine, including weaker economic activity, and fiscal policy measures taken in response to high energy prices. In 2023 the Czech Republic, Hungary, Poland and Romania exceeded the deficit reference value of 3% of GDP (Chart 2). The government debt-to-GDP ratio in 2023 was below the reference value of 60% in all of the countries under review except Hungary. In 2024 and 2025 the budget balance is expected to continue to exceed the reference value in Hungary, Poland and Romania.
Romania continues to be subject to an excessive deficit procedure, which was opened in 2020. On 19 June 2024 the European Commission found that Romania had not taken effective action to end its excessive deficit. The Commission recently also concluded that Hungary and Poland did not fulfil the government deficit criterion under the Stability and Growth Pact. The Commission will recommend to the EU Council to open excessive deficit procedures for these countries.
As regards the exchange rate criterion, only the Bulgarian lev is participating in the exchange rate mechanism (ERM II). Bulgaria joined ERM II with its existing currency board in place as a unilateral commitment in July 2020. This agreement on participation in ERM II was based on a number of policy commitments made by the Bulgarian authorities. Bulgaria is currently working towards completing these policy commitments, including by strengthening its anti-money laundering framework.
With regard to the convergence of long-term interest rates, three of the six countries under review (Poland, Romania and Hungary) recorded long-term interest rates above the reference value of 4.8%.
The strength of public and economic institutions is an important factor in the sustainability of convergence over time. With the exception of Sweden, indicators published by international organisations suggest that the quality of institutions and governance in the countries under review remains weaker than elsewhere in the EU.
As for the compatibility of national legislation with the Treaties and the Statute of the ESCB and of the ECB, five of the six countries under review were not fully compatible with the requirements for the adoption of the euro. With regard to Bulgaria’s legislation, the report concludes that its national legislation is consistent with the Treaty and the Statute, subject to conditions and interpretations set out in the relevant country assessment.
For media queries, please contact Eszter Miltényi-Torstensson, tel.: +49 171 769 5305.
Notes

The European Commission’s Convergence Report
The ECB’s Convergence Report reviews the economic and legal convergence of non-euro area EU Member States with a derogation every two years or at the request of a specific country. It assesses the degree of sustainable economic convergence with the euro area, whether the national legislation is compatible with the EU legal framework, and whether the statutory requirements are fulfilled for the respective national central banks. Given its “opt-out” clause, Denmark is not included in the assessment unless it so requests.
The cut‑off date for the statistics included in this Convergence Report was 19 June 2024. The reference period for both the price stability criterion and the long-term interest rate criterion is from June 2023 to May 2024. For exchange rates, the reference period is from 20 June 2022 to 19 June 2024. Historical data on fiscal positions cover the period up to 2023. Forecasts are based on the European Commission’s Spring 2024 Economic Forecast and the most recent convergence programmes of the countries concerned, as well as other information relevant to a forward-looking examination of the sustainability of convergence.

 
 
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More climate-friendly production of foods, clean fuels and chemicals in Europe is receiving a boost from the EU-Catalyst partnership, a joint initiative by the European Investment Bank (EIB), the European Commission and Breakthrough Energy Catalyst.
Energy equipment manufacturer Rondo Energy is receiving €75 million through grants and venture debt (subject to the satisfaction of funding conditions), so it can deploy in Europe a technology for turning intermittent renewable electricity into the continuous, high-temperature heat and power required by food, clean-fuel and chemical producers.
Rondo will use the funding to expand its European presence and build projects delivering low-cost, continuous, high-pressure, zero-carbon steam and power as a service.  This involves the construction of first-of-a-kind utility-scale long duration energy storage units with power-to-heat technology. The solution is based on a traditional heating of specially designed bricks by electric wires. The charging is done from dedicated renewable generation source or from the grid during the off-peak hours or hours of excess renewable production. The discharge ensures stable and reliable 24/7 heat supply in the form of steam, heated gas or cogeneration. This technology allows for decarbonization of industrial heat supply and can contribute to increased flexibility of the power system, therefore ensuring security of electricity supply, and for increasing the grid resiliency to intermittent power generation from renewable energy sources.
“The green transition requires massive investment for innovative technologies to replace industrial processes based on fossil fuels,” said EIB Vice-President Thomas Östros. “With today’s announcement, we are writing the next chapter of the EU-Catalyst partnership. We are delighted to support Rondo’s first-of-a-kind energy storage units. As the climate bank, we aim to finance many more net-zero technologies that will provide clean and affordable energy to power our industry and homes, while strengthening Europe’s competitiveness.”
“This project funding is a strong addition to our long-term relationship with Breakthrough, and puts Rondo firmly on the path to helping to eliminate the green premium for industrial heat electrification and to becoming a fully bankable technology which can be deployed at scale,“ said Eric Trusiewicz, CEO of Rondo Energy. “The grant from Breakthrough Energy Catalyst and the loan from the European Investment Bank together underpin Rondo’s development throughout Europe, where we see very strong tailwinds to the adoption of our technology.”
Commission Executive Vice-President for the European Green Deal, Maroš Šefčovič, said: “It is vital that Europe’s future green economy is built here. The EU-Catalyst Partnership is therefore an excellent blueprint for public-private support for large-scale green tech projects based in Europe. Thanks to the support provided by the Innovation Fund and Horizon Europe, this can help us step up funding levels, as the average investment needed for the EU to reach its 2030 climate target – to reduce greenhouse gas emissions – is equivalent to some 700 billion dollars per year. We also need to frontload this financing, and ease access to it to ensure a level playing field for smaller companies. These are make-it-or break-it conditions for the green transition.”
“Rondo’s technology offers industry a unique opportunity to decarbonize with inexpensive renewable electricity,” said Mario Fernandez, Head of Breakthrough Energy Catalyst. “Rondo’s deployment is crucial at a time when European manufacturers are urgently looking for ways to eliminate their dependence on natural gas. We’re proud to support these important projects across Europe and to work with such great partners in Rondo, the European Investment Bank, and the European Commission who bring the commitment and vision to commercialize this critical technology.”
The EU-Catalyst partnership creates a blueprint for public-private support for clean tech innovative technologies. It aims to accelerate the deployment of innovative low-carbon technologies while also reducing their green premiums, that is, bringing their costs to a level competitive with fossil fuels. EU funding for the partnership comes from EU’s research and innovation programme Horizon Europe and the Innovation Fund within the framework of InvestEU, according to the established governance procedures. Breakthrough Energy Catalyst mobilises equivalent private capital and philanthropic grants to fund the selected projects.
Background information
The EIB is the long-term lending institution of the European Union owned by its Member States. It is active in more than 160 countries and makes long-term finance available for sound investment in order to contribute towards EU policy goals.
The EIB, as implementing partner of the Commission under InvestEU, has been tasked to deploy for the benefit of this partnership up to €420 million, made available from both Horizon Europe, which has already committed €200 million, and the Innovation Fund, which has committed €220 million. The EU-Catalyst Partnership does not exclude potential additional contributions from EU Member States or other private partners that decide to further support the projects. Interested projects can apply for support through the Breakthrough Energy Catalyst website.
Horizon Europe is the EU’s key funding programme for research and innovation with a budget of €93.5 billion (2021-2027). The Innovation Fund is one of the world’s largest funding programmes for the deployment of net-zero and innovative technologies and sources its funds from the selling of EU Emissions Trading System allowances (estimated to amount to €40 billion from 2020-2030).
Breakthrough Energy is a global network of climate leaders committed to accelerating the world’s journey to a clean energy future. The organization funds breakthrough technologies, advocates for climate-smart policies, and mobilizes partners around the world to take effective action, accelerating progress at every stage.
Breakthrough Energy Catalyst is a novel platform that funds and invests in first-of-a-kind commercial projects for emerging climate technologies. By investing in these opportunities, Catalyst seeks to accelerate the adoption of these technologies worldwide and reduce their costs.
Rondo is purpose-built for industrial facilities: its Heat Batteries are constructed from proven, durable materials and are designed for seamless integration with existing industrial equipment and processes. Whether deployed as a drop-in replacement for retiring fossil-fueled heating equipment or as a resilient complement to existing systems, Rondo requires no disruptive changes to customers’ operations. Rondo currently operates the world’s highest temperature, highest efficiency commercial energy storage system, at Calgren Renewable Fuels in Pixley, California.
 
 
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By Giovanni Melina | Artificial intelligence can increase productivity, boost economic growth, and lift incomes. However, it could also wipe out millions of jobs and widen inequality.
Our research has already shown how AI is poised to reshape the global economy. It could endanger 33 percent of jobs in advanced economies, 24 percent in emerging economies, and 18 percent in low-income countries. But, on the brighter side, it also brings enormous potential to enhance the productivity of existing jobs for which AI can be a complementary tool and to create new jobs and even new industries.
Most emerging market economies and low-income countries have smaller shares of high-skilled jobs than advanced economies, and so will likely be less affected and face fewer immediate disruptions from AI. At the same time, many of these countries lack the infrastructure or skilled workforces needed to harness AI’s benefits, which could worsen inequality among nations.
As the Chart of the Week shows, wealthier economies tend to be better equipped for AI adoption than low-income countries. The data draw from the IMF’s new AI Preparedness Index Dashboard for 174 economies, based on their readiness in four areas: digital infrastructure, human capital and labor market policies, innovation and economic integration, and regulation.
Measuring preparedness is challenging, partly because the institutional requirements for economy-wide integration of AI are still uncertain. As the dashboard shows, different countries are at different stages of readiness in leveraging the potential benefits of AI and managing the risks.
Under most scenarios, AI will likely worsen overall inequality, a troubling trend that policymakers can work to prevent. To this end, the dashboard is a response to significant interest from our stakeholders in accessing the index. It is a resource for policymakers, researchers, and the public to better assess the AI preparedness and, importantly, to identify the actions and design the policies needed to help ensure that the rapid gains of AI can benefit all.
AI can also complement worker skills, enhancing productivity and expanding opportunities. In advanced economies, for example, some 30 percent of jobs could benefit from AI integration. Workers who can harness the technology may see pay gains or greater productivity—while those who can’t, may fall behind. Younger workers may find it easier to exploit opportunities, while older workers could struggle to adapt.
For policymakers, those in advanced economies should expand social safety nets, invest in training workers, and prioritize AI innovation and integration. Coordinating with one another globally, these countries also should strengthen regulation to protect people from potential risks and abuses and build trust in AI. The policy priority for emerging market and developing economies should be to lay a strong foundation by investing in digital infrastructure and digital training for workers.

For more on how artificial intelligence affects economies, see the December issue of Finance & Development, the IMF’s quarterly magazine, and the recent Analyze This! video.

 
Full post can be found here
 
 
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Blog post by Piero Cipollone | Freedom lies at the heart of the European Union’s principles. Every EU citizen is free to live, work, study and do business in any EU Member State.
The euro plays a key role in making this possible. We can use it to buy or sell goods and services anywhere in the euro area.
In providing euro banknotes, the European Central Bank (ECB) plays a crucial role in upholding these freedoms. Most Europeans want to have cash as a payment option and many view it as essential to their freedom: cash is easy to obtain, inclusive, universally accepted across the euro area and offers the highest level of privacy.
But we do not yet have a cash equivalent for making digital payments, which limits our freedom in an increasingly digital age.
Sometimes we can use national options, such as bank cards or digital wallets, to make electronic payments in shops. But in most euro area countries, these national solutions do not exist. And even when they do, they often do not work when shopping online, splitting bills among friends or travelling in the euro area. This forces us to rely on non-European cards or electronic payment solutions – although even these are not always accepted – and to use multiple payment methods.
To remedy these shortcomings, the ECB is working on a digital euro. We remain fully committed to cash, but we want to bring its benefits into the digital world. A digital euro would give consumers an additional payment option that complements cash. It would be up to them to decide whether to use it.
A digital euro would combine the convenience of digital payments with cash-like features. Like banknotes, it would offer Europeans the freedom to use a single public means of payment accepted throughout the euro area for digital payments in shops, on e-commerce websites or person to person. It could also be used offline, making transactions possible even when network coverage is limited or in the event of a power cut.
The digital euro would make it easier for euro area firms to offer pan-European digital payment solutions. This would strengthen competition in a market currently dominated by a few non-European players, thereby lowering costs for merchants and consumers. And it would reinforce Europe’s strategic autonomy and resilience. In a world that is increasingly divided and exposed to the dominance of large technology firms, we have a responsibility to ensure that Europeans are always able to make affordable and safe payments effectively.
The digital euro would offer greater privacy than that typically offered by existing commercial solutions. For offline payments, only the payer and the payee would have access to the transaction details. For online payments, we would use the latest privacy-enhancing technologies. All data would be pseudonymised and kept within the EU’s jurisdiction, thus enjoying the highest privacy standards in the world. And our compliance with data protection rules would be supervised by independent data protection authorities.
Free of charge for basic use, a digital euro would leave no one behind, including those with low digital and financial skills and vulnerable groups. An app would offer everyone an inclusive and accessible means of payment.
More than just a payment option, a digital euro would bring Europeans closer in an increasingly digital and unstable world. It would make our lives easier, while preserving our freedom of choice.
A year ago the European Commission put forward the Single Currency Package to protect cash payments across the euro area and to set out a framework for the possible issuance of a digital euro, which will only be considered once European legislators have adopted this framework. We welcome the ongoing democratic debate and we will continue engaging with all stakeholders.
As the world around us changes and geopolitical risks grow, we need to keep up the momentum. Together, we can ensure that the euro – our single currency – is ready for the digital era and continues to underpin the freedoms Europeans hold dear.
This article was published as an opinion piece in media outlets across the euro area.
 
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Remarks by Kristalina Georgieva, IMF Managing Director, to the Eurogroup on a Strategy for European Competitiveness, Luxembourg
As prepared for delivery
Thank you, Paschal, for your kind invitation to address ministers today on industrial policy, as part of your broader deliberations on competitiveness.
Last year, when I spoke here about the European capital market union, I started by saying it was a topic close to my heart, one we at the IMF deeply cared about. This year, a different tone: industrial policy is not something my colleagues and I cherish. And there are good reasons for it.
Let me note up-front that I plan to speak not just about industrial policy, but about how it fits in Europe’s strive for competitiveness. As I have argued many times, Europe’s core strength is the single market: fundamentally, Europe derives its prosperity, its competitiveness, and—yes—its market power from its cohesion.
With this basic truth in mind, today I will urge you to place discussions on the role and composition of industrial policy in the context an overarching, high-level strategy for productivity and competitiveness.
As I observed a short while ago as I presented the conclusions of the IMF’s annual consultation on euro area policies, the EU confronts a daunting list of challenges. Population aging; weak productivity growth; energy security; our common struggle against climate change; and, not least, the geoeconomic fragmentation that has, unfortunately, become our new global reality.
Preserving and sharpening Europe’s competitive edge in the face of such challenges requires not a reactive and piecemeal approach, but a well-thought out, multi-pronged strategy. Industrial policy may have a role to play as a small part of this strategy, but let me emphasize: in this case small—well-targeted and well-designed—is beautiful.
***
Of course, it’s a tough world out there—this much we know, I know. Last night I flew in from China, tomorrow I fly out to the United States. For me, this is a short stop at home—always very pleasant. Yes, Europe is geographically in the middle.
But is Europe caught in the middle too? To some extent, one can say Yes.
We see the major shifts underway. We know that many of the geopolitical concerns are real, that economic security actually matters. Across the globe, we see a resurgence in the use of industrial policy. In the US, the Inflation Reduction Act with its local-content requirements. In China, a history of support for various sectors.
Last year alone, we count over 2,600 industrial policy measures worldwide—with the US, China, and the EU making up roughly half of the total. These measures covered at least one-fifth of world trade. More than 70 percent were trade-distorting. Good economic rationale? Often not clear.
Still, some people like to say we live in a world of carnivores and that Europe behaves more like a herbivore. I am not so sure—at least not when I see last week’s tariff announcements on Chinese electric vehicles. You know that some form of retaliation will probably follow. My staff has given me a line on this matter, which I endorse. Let me quickly read it to you:
“The EU and China both benefit from an open trade system; we encourage them to cooperate to address the underlying concerns. Trade restrictions can distort the allocation of investment from where it is optimal, raising the cost of goods and services for final users. They can also slow the green transition and trigger retaliatory actions. We encourage all parties to work within the multilateral framework to resolve their differences.”
So there you have it: our cautionary position on the destructive potential of tit-for-tat protectionist measures.
As a general point, industrial policy can be a powerful tool, one that can, on rare occasion, be put to good use. But remember, history is littered with examples of industrial policy interventions gone wrong — the support for British Leyland in the UK, the ailing shipbuilders in Germany, Groupe Bull for computers made in France, BioValley in Malaysia, Solyndra in the United States, and the list can go on an on. In my personal experience looms large the former Soviet bloc: an entire economic system built around party functionaries deciding how to allocate the people’s savings. We know how that ended.
It is clear to see: technocrats picking winners and interfering in markets is a risky business—costly and distortionary. Design with care, handle with care. Use only when no better tools are available.
Full disclosure: this is personal for me. Having grown up on the other side of the Iron Curtain—the colder side of the Cold War—I much prefer the invisible hand of the market to the heavy hand of big government.
And a side comment: we know that with the pandemic shock and the energy shock governments everywhere have become much bigger. Debt and deficits are high, and now is the time to dial it back, not forward—we need front-loaded fiscal consolidation and lower debt, including to prepare for future shocks.
Coming back to industrial policy, let me briefly unpack when it can be appropriate. Two conditions must be satisfied. First, we must see a clearly identified market failure—the market not properly pricing or delivering a necessary thing. Second, we must assess that a broad-spectrum, less-distortionary, first-best policy approach is either unavailable or unable to deliver the desired outcome on its own.  Only when both conditions are satisfied can the use of an industrial policy intervention be appropriate—and then too, not always.
***
Three concrete examples of cases where industrial policy may have a role to play:

One, climate change. We know that the private sector alone will not deliver enough mitigation, and we know that our best tool—carbon pricing, vital as it is—cannot alone deliver rapidly enough to save us from calamity. There is simply no time to waste. This is existential. It is not something we can afford to take chances on. We at the IMF would argue that there may be a case to bolster mitigation efforts with industrial policy in support of the development and adoption of early-stage clean technologies. But let me be clear: we see no economic case for protecting mature clean tech—let this be produced wherever is least costly, globally. We all benefit from cheaper wind turbines and solar panels!
Two, supply-chain resilience. We saw during the pandemic the problems that arose from concentrated microchip supply. Diversification of the supply of critical goods like semiconductors is a real aim, and private firms may not have the incentive to do enough on their own—they weigh the benefits to themselves but not necessarily to the companies that rely on them further down. Does this mean we have a case for intervening to promote domestic chip production? Not necessarily, but perhaps in some circumstances—after careful analysis of the pros and cons, taking care to preserve a level playing field across firms.
Third, strategic public goods. Defense-related sectors are a classic example, where safeguarding the national security interest may be seen to require promoting domestic production and avoiding excessive reliance on foreign suppliers.

Let me offer a few words on industrial policy design when deployment is contemplated.
Three guiding principles:

First, know that picking winners and losers is inherently difficult. So, use industrial policy judiciously.
Second, as a European specificity, be sure to not undermine the single market. It is the EU’s greatest achievement. It is what gives the EU its economies of scale and scope, its heft on the global scene. Consider the externalities of state aid, for example: recent analysis by IMF staff finds that, while state aid may encourage the firms that receive it to hire more workers or invest more, it actually reduces, by a larger margin, jobs and investment in other firms in the same sector and in other EU countries that do not receive the aid. State aid may still be justified from a social perspective to redress a market failure and deliver benefits in the medium term but beware the potential for collateral damage. Thus, in Europe even more than elsewhere, use industrial policy with caution.
Third, let not industrial policy erect trade barriers that do more harm than good. Favoring domestic firms by relying on tariffs, discriminatory public procurement, or investment-screening controls is not only distortive, it tends to trigger retaliation, leading to less-efficient resource allocation globally. Recent history tells us that when one country introduces protectionist measures, there is about 75 percent probability of retaliation within a year. Ultimately, we get higher prices and fewer choices for consumers—self-defeating. When I think about the new tariffs on electric vehicles, I ask myself: to protect whom? Not today’s grass-roots consumer, who will probably pay more for green transportation. Not climate and the environment. Perhaps there is some intertemporal argument, but we at the IMF are unconvinced—watch out for some new analysis, coming soon.

Given the IMF’s role as guardian of the international monetary system, let me repeat the last point: a global escalation of tariffs can only make us collectively worse off while also undermining our existential struggle against climate change.
Finally, following on from the principles, a few specific recommendations for industrial policy interventions:

(A) Keep them temporary and try to preserve competition—in the free-market system, competition is what encourages firms to innovate, fostering a dynamic and resilient economy in the long run. Public policy interventions should endeavor to work with, not against, commercial incentives—for instance, by embracing public‒private co-investment where possible. And a clear exit strategy is imperative. Don’t just go in, know how you will get out!
(B) Keep them limited in scope to contain the fiscal costs and distortions, and coordinate at the EU level to protect the single market. Avoid national subsidies for national champions, complex and varied tax incentives, and divergent regulatory standards that lead to intra-EU fragmentation. Please: keep national politics out of it!
(C) Design and deliver national state-aid measures in ways that limit the adverse spillovers and fiscal strains on other member states. Your neighbor may not have your fiscal space!

In a nutshell: minimize distortions to international trade, avoid protectionist measures, comply with WTO rules, and protect Europe’s most precious economic asset: the single market. Whenever and wherever possible, choose cooperation over conflict!
***
Before I end, let me go back to where I began: advocating for a high-level competitiveness strategy. Let me list some critical aspects of that strategy—not things you shouldn’t do, things you should do!
Fundamentally, as I noted, Europe’s competitiveness derives from its cohesion. Your strategy, therefore, must center on strengthening the single market.
Many parallel efforts will be needed—it brings me back to the concluding messages of our euro area policy consultation. You need to remove trade barriers within the EU. You need to strengthen the labor market by allowing workers to move more freely with skills that are continuously upgraded and recognized across the union. You need to invest in EU infrastructure, including cross-border electricity grids for energy security. And you need to mobilize unprecedented volumes of money for the green transition.
I have spoken separately about the need for a more-ambitious EU budget and the savings of centralizing some projects of common interest. Hugely important.
Finally, you need to build a single European financial system, comprising both a banking union and a capital market union. Ultimately, this is about improving the allocation of savings to enhance productivity and growth potential.
I have said this before: Europe is rich, but it suffers from what I call “lazy money”—across the Atlantic, savings work much harder. Total financial sector assets in the euro area amount to about 60 trillion euros, not far short of the US’s 80 trillion euros. But, whereas in the US only one-third of the total sits in banks, in the euro area the banking share is two-thirds. Two implications to highlight today as I close:

One, while it is vital to press forward on capital market union, Europe cannot afford to neglect banking union—banks are where most of the money is. Please work together, in a cooperative spirit, to resolve the home‒host issues—I’m sure we can all agree that it is unacceptable that people can cross borders within the EU more easily than bank liquidity and capital!
Two, with banks being inherently less-well-suited to financing innovation—startups need long time horizons, and they often have no physical collateral to offer—targeted capital-market interventions may be necessary. I alluded to this earlier: the possibility of focused actions to support innovation and early-stage clean-tech. One specific idea from us: more action to support Europe’s under-developed venture capital industry. Again, we have a paper coming out soon. Among other things, its authors find that the European Investment Bank and European Investment Fund play a very constructive role in supporting financing for innovative European startups.

We are all familiar with the narrative of bright ideas being born in Europe but then migrating away to grow up elsewhere—Europe as someone else’s innovation supermarket. Europe needs a stronger venture capital industry, better able to support the best European startups so they can scale-up at home.
***
To sum it up: be generous in protecting and building the single market. Be stingy in using industrial policy. Promote the ideas of the future, not the industries of the past. Have a comprehensive strategy for competitiveness.
Thank you!
 
Read the full remarks here.
 
 
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€5 billion for high-speed rail, urban transport and upgrading ports
€2.6 billion for onshore wind, upgrading electricity grids, small scale renewables and biofuels
€2.9 billion for urban development, education, housing, health and water
€2.1 billion for corporate innovation, steel and semiconductor business financing

The Board of Directors of the European Investment Bank (EIB) today approved €12.8 billion of new financing to upgrade sustainable transport, increase renewable energy use, build new student housing, improve earthquake and flood protection, and help business to expand.
“Today we approved nearly €13 billion for flagship projects around Europe and beyond. From high-speed rail in Portugal, sustainable transport in Kyiv, Lille and Helsinki, renewable energy in Lithuania and support for small businesses. These investments will improve lives, and they signal the EIB Group’s commitment to continue supporting targeted investment that will boost European resilience, productivity growth and innovation.” said EIB President Nadia Calviño.
Investing in better transport
The Board backed €5 billion of financing to improve rail transport across Europe and port infrastructure in Cape Verde.
The EIB approved investment to build a high-speed rail line between Porto and Lisbon, upgrade trains in Germany and the Czech Republic, replace trams and buses in Lille, construct a light rail line in Helsinki.
Additional support for rail and urban transport investment in Ukraine was also agreed.
Scaling up renewable energy
€2.6 billion of new energy investment was approved by the Board. This includes new wind and solar power schemes, upgrading and expanding electricity distribution, financing small scale renewable energy use by industry and backing biofuel and biomethane production.
Amongst the new clean energy schemes agreed today are construction of a new onshore windfarm in Lithuania, district heating in the Netherlands and small-scale renewable energy projects across France and Greece.
Backing corporate innovation and business investment
The Board agreed €2.1 billion of new business financing, including support to expand semiconductor manufacturing, develop digital distribution technologies, back more energy efficiency steel production and convert existing industrial facilities to enable produce renewable packaging.
New schemes to improve access to finance by business in Ukraine and female entrepreneurs in Africa and the Caribbean were also agreed.
Improving health, education, water, and natural catastrophe preparedness
New investment to upgrade healthcare in Belgium and Malta, improve higher education in the Netherlands, expand student housing in Cyprus and tackle wastewater challenges in Germany were approved.
Backing for rehabilitation of buildings and infrastructure damaged by recent earthquakes and measures to address the risks of landslides and floods in Italy was also agreed.
Supporting business, transport and emergency response investment in Ukraine
Today’s board also approved investment to ensure that companies across Ukraine can access finance, upgrade urban and national rail links and to create a new 112 emergency call system in the country.
Background information
The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances sound investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality.
The EIB Group, which also includes the European Investment Fund (EIF), signed a total of €88 billion in new financing for over 900 projects in 2023. These commitments are expected to mobilise around €320 billion in investment, supporting 400,000 companies and 5.4 million jobs.
 
 
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The Commission is today providing policy guidance to Member States under the 2024 European Semester Spring Package to build a robust and future-proof economy that secures competitiveness, resilience and long-term prosperity for all, while maintaining sound public finances, in the face of a challenging geopolitical environment.
The EU is determined to take further steps to enhance its long-term competitiveness, prosperity and leadership on the global stage and to strengthen its open strategic autonomy. While the EU and its Member States have strong assets to build on, the EU will continue to address structural challenges that hamper its competitiveness, ensuring higher productivity growth and stronger investment and addressing labour and skills shortages.
This requires an integrated approach across all policy areas: macroeconomic stability, promoting environmental sustainability, productivity and fairness. The European Semester provides this policy coordination, including the implementation of NextGenerationEU, with the Recovery and Resilience Facility (RRF) at its core, and Cohesion Policy programmes. The European Semester cycle also provides updated reporting on progress towards the delivery of the Sustainable Development Goals and identifies investment priorities for the upcoming mid-term review of Cohesion Policy.
Resilience in the face of challenges
The European Semester has played a crucial role in supporting strong and coordinated economic policy responses over the past five years, as the EU was confronted by a series of extraordinary challenges. The EU has demonstrated a high degree of economic and social resilience in the face of major shocks, including the COVID-19 pandemic, Russia’s war of aggression against Ukraine and the related energy price surges and inflation hikes. Looking ahead, the Spring 2024 Economic Forecast projects GDP growth in 2024 at 1.0% in the EU and 0.8% in the euro area, on the back of a strong labour market and dynamic private consumption. In 2025, growth is forecast to accelerate further to 1.6% in the EU and to 1.4% in the euro area. Meanwhile, inflation is expected to fall from 6.4% in 2023 to 2.2% in 2025.
Targeted recommendations to Member States
The 2024 country reports analyse economic, employment and social developments in each Member State and take stock of the implementation of recovery and resilience plans (RRPs) and Cohesion Policy programmes. The reports also identify key challenges, with a particular focus on competitiveness, and priority reforms and investments. Based on this analysis, the Commission proposes country-specific recommendations (CSRs) to provide guidance to Member States on how to tackle those key challenges that are only partially or not addressed in Member States’ RRPs.
The country-specific recommendations are divided into:

A recommendation on fiscal policy, including fiscal-structural reforms, where relevant;

A recommendation to continue or accelerate implementation of the national recovery and resilience plans and Cohesion Policy programmes; and
Where relevant, further recommendations on outstanding and/or newly emerging structural challenges, with a focus on improving competitiveness.

Effective delivery of NextGenerationEU and Cohesion Policy: crucial drivers of a competitive EU economy
As illustrated in this year’s country reports, NextGenerationEU and other EU funding programmes have supported the EU’s recovery towards a greener, more digital, fairer and more resilient future through job creation, improved competitiveness, macroeconomic stability and territorial and social cohesion.
To date, the Commission has disbursed over €240 billion to Member States in RRF grants and loans for the successful implementation of key reforms and investments. Also, over €252 billion has been disbursed under the Cohesion Policy funds since the beginning of the COVID-19 pandemic.
Most Member States continue to make good progress in the delivery of their RRPs and Cohesion Policy programmes. However, some Member States need to urgently address emerging delays and structural challenges, to ensure the timely implementation of investments and reforms included in their RRP. This Semester cycle also provides guidance to Member States in view of the forthcoming mid-term review of Cohesion Policy programmes.
Policy guidance to enhance competitiveness
The Spring Package calls on Member States to take policy action to promote competitiveness and increase productivity. To this end, Member States are invited in the CSRs to:

Ensure a business environment supportive to competitiveness, taking full advantage of the opportunities generated by the single market, especially for SMEs;
Improve educational outcomes and support skills development, with high-quality education and training based on modernised curricula, since addressing labour and skills shortages is essential to ensure the EU’s prosperity;
Facilitate access to finance by improving savings allocation and capital financing and facilitating capital market and alternative forms of financing, especially for SMEs. Implement ambitious reforms to build integrated research and innovation ecosystems, focusing on science-business collaboration and knowledge transfers for example; and
Accelerate the green and digital transition, increasing the autonomy, resilience and competitiveness of the EU’s net-zero industry, addressing labour and skills shortages, boosting public investment in digital infrastructure and skills, and tackling regulatory barriers to digitalisation.

Strengthening fiscal sustainability
The COVID-19 pandemic, the surge in energy prices, and the required policy response have contributed to a substantial increase in public debt in several Member States in recent years. Fiscal policies should put debt on a downward path or to keep it at prudent levels, while preserving investment.
The new economic governance framework makes 2024 a year of transition for fiscal policy coordination in the EU. The fiscal policy guidance and decisions under the new framework contained in the Spring Package aim to strengthen Member States’ debt sustainability and promote sustainable and inclusive growth in all Member States.
Under the new rules, Member States will prepare medium-term plans setting out their expenditure paths and their priority reforms and investments. The recommendations included in the Spring Package provide a strong underpinning for the reform and investment commitments Member States must set out in these plans.
The CSRs provide that Member States should pursue prudent fiscal policies by ensuring that the growth in net expenditure in 2025 and beyond is consistent with the fiscal adjustment requirements under the new governance framework.
Concretely, this means that Member States with public debt above 60% of GDP or a deficit above 3% of GDP should ensure that the growth in net expenditure is limited to a rate that puts the government debt-to-GDP ratio on a plausible downward path over the medium term, while bringing the general government deficit to below 3% of GDP and maintaining it below this reference value over the medium term.
Fiscal surveillance
The Commission prepared a Report under Article 126(3) of the Treaty on the Functioning of the EU (TFEU) for 12 Member States to assess their compliance with the deficit criterion of the Treaty: Belgium, Czechia, Estonia, Spain, France, Italy, Hungary, Malta, Poland, Slovenia, Slovakia and Finland. In this assessment, the Commission takes into account relevant factors brought forward by Member States in case their public debt-to-GDP ratio is below 60% of GDP or their deficit is assessed as being ‘close’ to the 3% reference value and ‘temporary’.
In light of the assessment contained in the report, the opening of a deficit-based excessive deficit procedure is warranted for seven Member States: Belgium, France, Italy, Hungary, Malta, Poland and Slovakia.
The Report under Article 126(3) is only the first step into opening the excessive deficit procedures. In light of this assessment, and after considering the opinion of the Economic and Financial Committee, the Commission intends to propose to the Council to open deficit-based excessive deficit procedures for these Member States in July 2024. As part of the Autumn European Semester Package, to ensure consistency with the adjustment path set out in the medium-term plans, the Commission will propose to the Council recommendations to put an end to the excessive deficit situation.
In 2020, the Council decided that an excessive deficit existed in Romania, based on 2019 data. According to the Commission’s assessment, Romania has not taken effective action to correct this and put an end to its excessive deficit situation.
Assessing macroeconomic imbalances
The Commission has assessed the existence of macroeconomic imbalances for the 12 Member States selected for in-depth reviews in the 2024 Alert Mechanism Report. Overall, after the big terms-of-trade shock of 2022, macroeconomic imbalances tended to ease in most Member States.

France, Spain, and Portugal are no longer experiencing imbalances as vulnerabilities have overall declined. Fiscal sustainability risks will be surveyed under the reformed fiscal rules.

Greece and Italy are now found to be experiencing imbalances after experiencing excessive imbalances until last year as vulnerabilities have declined but remain a concern. Fiscal sustainability risks will be surveyed under the reformed fiscal rules.

Slovakia is now found to be experiencing imbalances. The vulnerabilities related to cost competitiveness, external balance, housing market and household debt have lingered, and policy action has not been forthcoming.

Romania is now found to be experiencing excessive imbalances after experiencing imbalances until last year as vulnerabilities related to external accounts, mainly linked to large and increasing government deficits, remain, while significant price and cost pressures have increased and policy action has been weak.

Germany, Cyprus, Hungary, the Netherlands, and Sweden continue to experience imbalances.

Post-programme surveillance reports
Post-programme surveillance assesses the economic, fiscal and financial situation of Member States that have benefited from financial assistance programmes, focusing on their repayment capacity. The post-programme surveillance reports for Ireland, Greece, Spain, Cyprus and Portugal conclude that all five Member States retain the capacity to repay their debt.
Assessing social convergence challenges
In this Semester cycle, the Commission has carried out for the first time a two-stage analysis of employment, skills and social challenges in each Member State, based on the revised Social Scoreboard and the principles of a Social Convergence Framework. The first-stage analysis is included in the Joint Employment Report (JER) 2024, while a more detailed second-stage analysis was published by the Commission services in May 2024 for seven Member States (Bulgaria, Estonia, Spain, Italy, Lithuania, Hungary and Romania).
Employment guidelines
The Commission is proposing guidelines for Member States’ employment policies in 2024. These guidelines set common priorities for national employment and social policies to make them fairer and more inclusive.
The 2023 guidelines are updated to cover actions to tackle skills and labour shortages and improve basic and digital skills. New technologies, artificial intelligence and algorithmic management and their impact on the world of work are also included. In addition, the guidelines refer to recent policy initiatives, in areas of particular relevance such as platform work, the social economy, and affordable housing.
Finally, the Commission underlines the importance of monitoring progress towards the EU-wide 2030 headline targets, and the contributing national targets, in the areas of jobs, skills and poverty reduction.
Next steps
The Commission invites the Eurogroup and the Council to discuss the package and to endorse the guidance offered today. It looks forward to engaging in a constructive dialogue with the European Parliament on the contents of this package and each subsequent step in the European Semester cycle.
 
For more information, please contact:

Veerle Nuyts, Spokesperson

Marajke Slomka, Press Officer

 
 
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The Commission has today proposed an annual EU budget of €199.7 billion for 2025. The budget will be complemented by an estimated €72 billion of disbursements under NextGenerationEU. This substantial financial envelope will support the EU in meeting its political priorities while integrating the changes agreed in the mid-term revision of the Multiannual Financial Framework (MFF) in February 2024.
The draft budget 2025 directs funds to where they can make the greatest difference, in cooperation and in line with the needs of the EU Member States and our partners around the world to make Europe more resilient and fit for the future to the benefit of EU citizens and businesses. This will be done by fostering the green and digital transitions, by creating jobs while strengthening Europe’s strategic autonomy and global role. It will enable support to key critical technologies through the Strategic Technologies for Europe Platform (STEP).
The draft budget 2025 will also provide – in line with the MFF mid-term revision – continued support for Syrian refugees in Türkiye and the wider region, the Southern Neighbourhood including the external dimension of migration, as well as the Western Balkans. Crucially, it will provide stable and predictable support to Ukraine.
The Commission proposes to allocate the following amounts to the various EU priorities (in commitments):

€53.8 billion for the Common Agricultural Policy and €0.9 billion for the European Maritime, Fisheries and Aquaculture Fund, for Europe’s farmers and fishers, but also to strengthen the resilience of the agri-food and fisheries sectors and to provide the necessary scope for crisis management.
€49.2 billion for regional development and cohesion to support economic, social and territorial cohesion, as well as infrastructure supporting the green transition and Union priority projects.
€16.3 billion to support our partners and interests in the world, of which, among others, €10.9 billion under the Neighbourhood, Development and International Cooperation Instrument — Global Europe (NDICI — Global Europe), €2.2 billion for the Instrument for Pre-Accession Assistance (IPA III) and €0.5 billion for the Growth Facility for the Western Balkans, as well as €1.9 billion for Humanitarian Aid (HUMA).
A further €4.3 billion will be available in grants under the Ukraine Facility complemented by €10.9billion in loans.
€13.5 billion for research and innovation, of which mainly €12.7 billion for Horizon Europe, the Union’s flagship research programme. The Draft Budget also includes the financing of the European Chips Act under Horizon Europe and through redeployment from other programmes.
€4.6 billion for European strategic investments, of which, for instance, €2.8 billion for the Connecting Europe Facility to improve cross-border infrastructure, €1.1 billion for the Digital Europe Programme to shape the Union’s digital future, and €378 million for InvestEU for key priorities (research and innovation, twin green and digital transition, the health sector, and strategic technologies).
€2.1 billion for spending dedicated to space, mainly for the European Space Programme, which will bring together the Union’s action in this strategic field.
€11.8 billion for resilience and values, of which, among others, €5.2 billion for the rising borrowing costs for NGEU, €4 billion Erasmus+ to create education and mobility opportunities for people, €352 million to support artists and creators around Europe, and €235 million to promote justice, rights, and values.
€2.4 billion for environment and climate action, of which mainly €771 million for the LIFE programme to support climate change mitigation and adaptation, and €1.5 billion for the Just Transition Fund to make sure that the green transition works for all.
€2.7 billion for protecting our borders, of which mainly €1.4 billion for the Integrated Border Management Fund (IBMF), and €997 million (total EU contribution) for the European Border and Coast Guard Agency (Frontex).
€2.1 billion for migration-related spending within the EU, of which mainly €1.9 billion to support migrants and asylum-seekers in line with our values and priorities.
€1.8 billion to address defence challenges, of which mainly €1.4 billion to support capability development and research under the European Defence Fund (EDF) and €244.5 million to support Military Mobility.
€977 million to ensure the functioning of the Single Market, including €613 million for the Single Market Programme, and €205 million for work on anti-fraud, taxation, and customs.
€583 million for EU4Health to ensure a comprehensive health response to people’s needs, as well as €203 million to the Union Civil Protection Mechanism (rescEU) to be able deploy operational assistance quickly in case of a crisis.
€784 million for security, of which, notably, €334 million for the Internal Security Fund (ISF), which will combat terrorism, radicalisation, organised crime, and cybercrime.
€196 million for secure satellite connections under the new Union Secure Connectivity Programme.

The draft budget for 2025 is part of the Union’s long-term budget as adopted at the end of 2020 and as amended in February 2024, including subsequent technical adjustments, and seeks to turn its priorities into concrete annual deliverables.
The annual budget for 2025 will have to be formally adopted by the Budgetary Authority before the end of the year.
Background
The draft EU budget for 2025 includes the expenditure covered by the appropriations under the long-term budget ceilings, financed from own resources. These are topped up by expenditure under NextGenerationEU, financed from borrowing on the capital markets. For the “core” budget, two amounts for each programme are proposed in the draft budget – commitments and payments. “Commitments” refer to the funding that can be agreed in contracts in a given year; and “payments” to the money actually paid out. All amounts are in current prices.
For more information, please contact:

Olof Gill, Spokesperson

Veronica Favalli, Press Officer

 
 
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Blog post by Era Dabla-Norris, Ruud de Mooij | New generative-AI technologies hold immense potential for boosting productivity and improving the delivery of public services, but the sheer speed and scale of the transformation also raise concerns about job losses and greater inequality. Given uncertainty over the future of AI, governments should take an agile approach that prepares them for highly disruptive scenarios.

A new IMF paper argues that fiscal policy has a major role to play in supporting a more equal distribution of gains and opportunities from generative-AI. But this will require significant upgrades to social-protection and tax systems around the world.
How should social-protection policies be revamped in the face of disruptive technological changes from AI? While AI could eventually boost overall employment and wages, it could put large swaths of the labor force out of work for extended periods, making for a painful transition.
Lessons from past automation waves and the IMF’s modeling suggest more generous unemployment insurance could cushion the negative impact of AI on workers, allowing displaced workers to find jobs that better match their skills. Most countries have considerable scope to broaden the coverage and generosity of unemployment insurance, improve portability of entitlements, and consider forms of wage insurance.
At the same time, sector-based training, apprenticeships, and upskilling and reskilling programs could play a greater role in preparing workers for the jobs of the AI age. Comprehensive social-assistance programs will be needed for workers facing long-term unemployment or reduced local labor demand due to automation or industry closures.

To be sure, there will be important differences in how AI impacts emerging-market and developing economies—and thus, how policymakers there should respond. While workers in such countries are less exposed to AI, they are also less protected by formal social-protection programs such as unemployment insurance because of larger informal sectors in their economies. Innovative approaches leveraging digital technologies can facilitate expanded coverage of social-assistance programs in these countries.
Should AI be taxed to mitigate labor-market disruptions and pay for its effects on workers? In the face of similar concerns, some have recommended a robot tax to discourage firms from displacing workers with robots.
Yet, a tax on AI is not advisable. Your AI chatbot or co-pilot wouldn’t be able to pay such a tax—only people can do that. A specific tax on AI might instead reduce the speed of investment and innovation, stifling productivity gains. It would also be hard to put into practice and, if ill-targeted, do more harm than good.
So, what can be done to rebalance tax policy in the age of AI? In recent decades, some advanced countries have scaled up corporate tax breaks on software and computer hardware in an effort to drive innovation. However, these incentives also tend to encourage companies to replace workers through automation. Corporate tax systems that inefficiently favor the rapid displacement of human jobs should be reconsidered, given the risk that they could magnify the dislocations from AI.

Many emerging market and developing countries tend to have corporate tax systems that discourage automation. That can be distortive in its own way, preventing the investments that would enable such countries to catch up in the new global AI economy.
How should governments design redistributive taxation to offset rising inequality from AI? Generative-AI, like other types of innovation, can lead to higher income inequality and concentration of wealth. Taxes on capital income should thus be strengthened to protect the tax base against a further decline in labor’s share of income and to offset rising wealth inequality. This is crucial, as more investment in education and social spending to broaden the gains from AI will require more public revenue.
Since the 1980s, the tax burden on capital income has steadily declined in advanced economies while the burden on labor income has climbed.

To reverse this trend, strengthening corporate income taxes could help. The global minimum tax agreed by over 140 countries, which establishes a minimum 15-percent effective tax rate on multinational companies, is a step in the right direction. Other measures could include a supplemental tax on excess profits, stronger taxes on capital gains, and improved enforcement.
The latest AI breakthroughs represent the fruit of years of investment in fundamental research, including through publicly funded programs. Similarly, decisions made now by policymakers will shape the evolution of AI for decades to come. The priority should be to ensure that applications broadly benefit society, leveraging AI to improve outcomes in areas such as education, health and government services. And given the global reach of this powerful new technology, it will be more important than ever for countries to work together.
—Fernanda Brollo, Daniel Garcia-Macia, Tibor Hanappi, Li Liu, and Anh Dinh Minh Nguyen contributed to the staff discussion note on which this blog is based.

 
Full post can be found here
 
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