Investment initiative in response to coronavirus

Key points

The EESC

• believes that the principles of common values, protection of life and freedom, economic success, social rights, solidarity and subsidiarity are essential to the functioning of the EU. Therefore, warmly welcomes the fact that the European Commission has responded quickly by establishing adjusted and efficient means of providing financial support to face the COVID-19 pandemic;
• stresses the need for a very rapid response. Many firms are laying off employees, leading to a sharp decline in economic activity and an increase in unemployment. Welcomes the Coronavirus Response Investment Initiative, which aims to promote investment by mobilising available reserves in the European Structural and Investment (ESI) Funds and providing financial support to Member States;
• agrees with the intention to quickly mobilise the cash reserves (unspent funds for advance payments) as mentioned in the Commission's draft regulation to boost economic investment. Moreover, urges the Commission to check all additional funding options available under the EU budget to support key services and people;
• strongly supports enhanced flexibility mechanisms within the multiannual financial framework (MFF) to create a more agile MFF that can provide financial resources to counter the shocks. In this connection, the EESC calls on the heads of state and governments to finally act and prepare the ground for the Council to adopt an ambitious 2014-2020 MFF as soon as possible;
• emphasizes that, in this crisis, the solvency of businesses, including social and health service providers, is becoming a very important issue, especially as the shutdown of the economy continues and in light of the uncertain economic outlook;
• suggests that the European Regional Development Fund (ERDF) support the financing of working capital where necessary as a temporary measure to provide an effective response to the public health crisis;
• stresses the need to reduce red tape and keep administrative burdens to an absolute minimum. The funds must be allocated quickly and fairly;
• welcomes the fact that the Commission is paying particular attention to public health systems and to small and medium-sized enterprises (SMEs), recognizing their vulnerability as their business operations are being disrupted due to the lockdown measures introduced in several countries;
• underlines the importance of ensuring the adequate liquidity and stability of the European banking system, as it plays an essential role in financing households and businesses and therefore will be key to easing the effects of the COVID-19 crisis on the European economy. Loans should be provided at a zero-interest rate;
• also emphasizes the importance of making full use of the flexibility of the European fiscal framework, not only to help mitigate the immediate effects of the COVID-19 crisis, but also to support the recovery of the European economy in the aftermath of the pandemic;
• urges the Commission to mobilise key funds as quickly as possible, such as the European Globalisation Adjustment Fund (EGF), to support dismissed workers and the self-employed, who will be hit by the pandemic;
• also stresses the need to involve the social partners at EU and national level, as well as relevant civil society organisations, to ensure the effective management of the COVID-19 crisis;
• calls upon the Council and the European Parliament to swiftly approve the Regulation so that it can be adopted as soon as possible. The scale of the challenge requires a collective, commensurate and more coordinated response.