Never before in history have the citizens of the European Union had to face such unprecedented uncertainty. The COVID-19 crisis has brought into sharp relief the fragility of our way of life and of the assumptions our societies and economies are based on. While the battle to flatten the curve appears to be producing certain results, the other battle – to save the European economy – seems to be even more challenging.
The estimation of losses for the economy is shocking. According to the UN, COVID-19 will cost the global economy USD 2 trillion this year alone. To face this crisis, we need extraordinary and unprecedented economic measures and true, unconditional European solidarity. This moment calls for strong political leadership and a unanimous act of courage by Europe's political leaders.
Preserving jobs should be a priority for the EU. The more companies survive these tough times, the fewer people will lose their jobs and thus need help from the state. I believe that initiatives such as the European instrument for temporary support (SURE) and the release of EUR 1 billion from the European Fund for Strategic Investments (EFSI) to provide liquidity to SMEs, as well as actions by the European Central Bank, are steps in the right direction, but the scale of the crisis means that the flow of funds must be even larger.
In addressing the current crisis, time matters more than ever before. In numerous sectors of the economy, companies will not survive without help for more than a month or two. It is crucial for aid – coming from both national and European level – to reach the recipients as quickly as possible, without red tape. This is a challenge that both European and national administrations have to address. Efficiency and proper information are more important than ever before.
The decision of the recent European Council to link recovery fund within new proposal of the MFF (Multiannual Financial Framework) is a step in right direction. It allowed reducing tensions between Member States, having different visions on how to finance the recovery. Now Commission must transform this political consensus into concrete proposal, agree on MFF and implement it as quickly as possible.
Access to recovery fund must be equal across all Member States. Every week makes a huge difference for thousands of companies. Once health emergency is over, we must have all necessary tools to kick-start the European economy as quickly as possible.
The outbreak of COVID-19 has shaken one of the foundations of the European Union – the Single Market. Efforts to combat the spread of coronavirus should not lead to limitations on the free flow of goods. We must protect the Single Market and keep it operational. Once the emergency is over, completion of the Single Market will be one of the cornerstones of the recovery.
While some EU countries are making their first modest moves to relaunch their economies, it is now obvious that certain restrictions and limitations will be with us for months. Going back to normal will not mean going back to how things used to be. The need to rethink certain daily operations or even whole business models provides a unique opportunity for innovation and an outside-the-box approach.
The COVID-19 pandemic has brought to the fore the harsh reality that the EU lacks the necessary rules and conditions to respond quickly and coherently to such an emergency. The lessons being learned from this health emergency must put the creation of an "EU Health Union" on the European agenda. The pandemic has also once again reminded us of the importance of proper investment both in health care and in medical R&D.
In the past, crises provided the EU with an opportunity to deepen integration, and I believe this should also be the case today. The current crisis has shown how deeply interconnected we are due to globalisation. In some cases, the architecture of global value chains has backfired during the pandemic. This is another lesson to be learned. I fully agree with the former President of the European Council, Herman van Rompuy, who stated that the EU as a whole needed to be much more sovereign in the economic, technological, energy, medical and agricultural fields.
In this edition of our newsletter, you will find the views of the major European employers' organisations on what measures are needed to overcome the current crisis. We invited them all to contribute because we believe that the economic difficulties caused by COVID-19 can only be overcome through courageous action and unprecedented solidarity. The employers' organisations, thanks to the direct feedback they get from their members, are best placed to know what is needed on the ground to save the European economy. We provide this feedback to our governments on a daily basis and we want to provide it to EU policy-makers too. The business community cannot be left out of this debate!
Acting President of the Employers' Group