The idea that it needs to be reformed was floated long ago. Yet the rule still stands practically as it was before the euro crisis of 2008-2012.

It was intended to lock the euro zone into a sustainable union in the absence of a "federal" budget, which is the hallmark of a territory covered by one currency. The eurozone member states all have national governments which run substantial national budgets. If they all go along separate ways in their spending strategies, they could quickly unbalance the common currency, which is "theirs" as well. So it was agreed to introduce strictly applicable rules regarding the management of national budgets.

One main stricture is that public spending should not carry on and create budgetary deficits that exceed 3 per cent of the country gross domestic product. The rule was meant to limit expenditures. But it does not distinguish between consumption expenditures and investment outlays.To stay in line with this rule, governments have over the years, preferred to curtail  investment in order to be able to spend more on consumption.

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REPORT

It's not usual for the International Monetary Fund's annual report to sound as flat as it does for the year 2026. It seems to have been put together as an inventory of what was said and still is being said during the past year regarding ongoing economic convulsions. No clear analytical perspective emerges regarding what future options could be.

Maybe this is so because the initiatives undertaken by the leaders of large and small states have increasingly become arbitrary and political in nature. Even when they're anchored to economic or commercial considerations, their motivation is felt as being strictly political. Acts and threats of war... resources which are taken over for use as tools of power and persuasion... these have become the new normal. The International Monetary Fund is not well equipped to factor such aspects into its calculations... although it had praise for the "resilience" that is being demonstrated by the global economy in the wake of "unusual" developments...

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CYBER SECURITY

Less than five years ago, as rapporteur for the socialist group in the European Parliament along with counterparts from the other political groups, I was involved in quite intensive work to introduce a law to ensure that effective cyber security operations would be introduced by European banks and financial institutions. This was to cover their payment systems, the funds they received and administered, and the methods by which they engaged and monitored service providers in charge of their electronic transactions.

Labelled DORA, the law that we helped to develop in wide consultations with banks and firms deeply involved in internet business, was meant to provide optimal cyber security. There was some criticism that it was too onerous. In those days, concerns about the impact of artificial intelligence were just beginning. Today from what I read and hear about AI, I very much fear that what we strived so hard to put into DORA has already become weak and obsolete.