Week Ahead (16 November)

W/C Monday, 16 November - EU/UK trade deal talks continue, with European Council meeting touted as deadline for deal

Talks between the EU and the UK on a trade deal will continue ahead of the European Council's teleconference on Thursday. The meeting is being touted as yet another deadline for a UK-EU trade deal before the expiry of the transition period on 1 January.

For a deal to be reached several long-standing issues will have to be resolved in short order, including fisheries, level playing field arrangements and the establishment of a dispute resolution mechanism. MEPs had hoped to have a draft deal before them by today so that the ratification process could begin, with a target of holding a final vote on a potential deal on 14 December. However, an extraordinary meeting over the Christmas period may now have to be arranged, should a deal be struck.

Monday, 16 November – New European Parliament sub-committee to discuss co-ordinated tax policy

Members of the newly formed sub-committee on Tax Matters will hold a public hearing today to discuss how an EU co-ordinated tax policy could assist member states as their economies recovery post-pandemic. The discussion will focus particularly on the fight against tax avoidance and evasion.

The Economic and Monetary Affairs Committee recently discussed the importance of making the EU more resilient post-pandemic, and highlighted tax evasion and avoidance as a serious drain on potential revenues. The committee said that tax avoidance in the EU potentially amounted to between €160 billion and €190 billion each year.

Tuesday, 17 November – Trilogue negotiations on EU Recovery and Resilience Facility

After the European Parliament agreed its position on how the €672.5 billion recovery funding should be spent, a first round of trilogue negotiations between the European Commission, Parliament and Council got underway last Friday. Negotiations will recommence tomorrow with several areas of divergence between the positions of the three institutions.

The Parliament wants government to spend at last 7% of recovery funds on industrial policies, social needs, updating public administration, and support for youth. Council is open to the idea of expanding the scope of the recovery spending but the Commission has objected, saying it has only developed spending guidelines for greening and the digitalisation of the economy. The negotiators aim is to reach agreement by end 2020 to ensure Member States have plenty of time to adjust to finalised spending guidelines ahead of the 30 April deadline to submit spending plans.

Tuesday, 17 November - HICP inflation data to be released

Eurostat is due to release HICP inflation data for the Eurozone for October tomorrow. The HICP inflation flash estimate for the month, released on 30 October, showed that the euro area’s annual inflation rate remained at -0.3% from September. By comparison, the inflation rate for October 2019 was 0.7%. The October flash figures remain far below the ECB’s target of a "below, but close to 2%" medium-term inflation rate.