BRUSSELS (Reuters) – As the world grapples with the consequences of the U.S. election results, the European Union is looking at how to fix its social security system in a way that is least disruptive to businesses.

Breadth and continuity of the euro zone’s system of mutual aid and protection, the EU is also seeking to address concerns about rising cost pressures in its public sector pension funds, which are expected to reach $16.6 trillion in 2024, up from $15.7 trillion at the end of 2021, according to the International Monetary Fund (IMF).

The issue will be one of whether the EU can afford to keep up with rising costs of health care and pensions in the public sector, and whether it can keep up in reducing the number of people in the system.

The debate is taking place amid rising concern about rising costs in the EU’s public sector and the impact of Brexit on the economy, especially in the south-east European country of Belgium.

The Brussels-based International Monetary and Finance Association (IMFA) said on Wednesday that its forecasts for the EU public sector are more pessimistic than its forecasts two years ago for the economy.

The outlook for 2020-2021 has been cut from a range of 7.5 percent to 6.4 percent and by 3.9 percent to 2.8 percent, IMFA chief economist Thomas Vos said.

The average forecast for the future, which also excludes the effects of Brexit, is 7.4 to 7.6 percent.

Vos said there are some areas in which the EU could achieve more in 2020-21, such as in the fight against high COVID-19 mortality and the reduction in the number and age of people entering retirement, both of which are projected to reach 1.8 billion by 2024.

In 2021, the number is projected to be 1.7 billion, up about 4 percent from a year earlier.

But he said the public debt is likely to rise, which will mean higher taxes and spending, including on pensions.

“The issue of the public debts will be at the centre of the discussions in the coming years,” Vos told reporters.

“It’s clear that the public finances have to be addressed, that it has to be made more sustainable, and that it will have to get more efficient.”

The EU is not alone in its concerns.

The IMF expects the public deficit in the euro area to increase to 1.4 trillion euros ($1.7 million) by 2024 from 1.3 trillion euros in 2020, with rising inequality and social exclusion in many countries, as well as higher rates of unemployment.

In 2017, the public deficits were estimated at 1.6 billion euros ($2.2 billion) and 1.2 trillion euros, respectively.

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