Coronavirus: the responses of EU institutions

Over the past few weeks several criticisms have been raised against the EU institutions, being accused of not having reacted and of not having provided responses to the Coronavirus emergency. On the contrary, if we look carefully we realise it is not so. The EU Commission, the ECB, the European Investment Bank, the European Banking Authority, the EU Parliament … all have acted to use all resources available.

To have a clearer picture I have summed up below the timeline of acts, decisions and interventions taken by the EU institutions since the beginning of the emergency. We know that the existing tools are not sufficient and that member States need to agree on new and more powerful instruments, but stating that European institutions have not responded is incorrect.

(P.S. The list below includes only economic measures and does not mention health decisions, like the research funds, the initiatives to expedite the influx of sanitary materials, those to help EU citizens repatriate and the Europe-wide procurement efforts to purchase and distribute ventilators and other health materials).

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27/01/2020: Council – activated the Integrated Political Crisis Response (IPCR) mechanism to share useful information to counter the Coronavirus emergency.

02/03/2020: Commission – Coronavirus Response Team (made up of 5 Commissioners) launched.

05/03/2020: Italian Government – Letter by Gualtieri to Commissioners Dombrovskis and Gentiloni on the Italian Covid-19 response measures with a first package of over 6 billion euro.

13/03/2020: Commission -The EC presents the European coordinated response with a 37 billion euro package that includes: flexibility on state aid regulations, flexibility of the EU budget framework, European procurement procedure for medical equipment, EU budget mobilisation with a 1 billion euro guarantee for the European Investment Fund; the possibility to use the 179 million euro for 2020 from the European Globalization Adjustment Fund to support those who have lost their employment and autonomous workers.

13/03/2020: Commission – Response by Commissioners Dombrovskis and Gentiloni to Italy’s 10 March Letter: Italy’s requests accepted.

18/03/2020: ECB – new 750 mld € bond buying programme.

20/03/2020: Commission – proposal sul suspend the Stability and Growth Pact; standards made available and free to produce masks and other medical protective equipment.

20/03/2020: Single Supervisory Mechanism (SSM) – maximum flexibility: state guarantee or moratory on deteriorated loans being classified as UTP, and flexibility on prudential and accounting measures.

22/03/2020: Commission – state aid measures, 50 million approved for Italy to support the production and distribution of medical equipment.

23/03/2020: Council – Suspension of the Stability and Growth Pact: ECOFIN adopts the escape clause, loosening the EU Budget norms to manage the Covid-19 consequences.

25/03/2020: European Banking Authority – flexibility in the classification of credits.

26/03/2020: European Parliament – the Plenary session approved the Commission proposal of 13 March (37 billion package and other initiatives).

02/04/2020: Commission – SURE programme proposed: 100 billion to provide member States with advantageous loans and without conditions to finance short-time work schemes like furlough. Coronavirus Response Investment Initiative+: presented, a second step in addition to the 37 billion plan approved by Parliament that provides extraordinary flexibility in the use of European funds, possibility of EU 100% co-financing for cohesion policy programmes and simplification of procedures. Finally, presented the emergency support instrument of the European Union for the health and medical industry of 3 billion euro.

03/04/2020: Commission – extension of the temporary framework on state aid regulations and suspension of tariffs and VAT on import of medical equipment from third countries.

03/04/2020: EIB – the Executive Committee of the Bank announces the proposal to the Eurogroup to create a 25 billion European guarantee fund to allow the EIB to provide 200 billion euro in loans to the private sector, with a focus on SMEs.

09/04/2020: Council: the Eurogroup annouces: (1) the agreement on the SURE programme; (2) the institution of a new 240 billion euro line of credit in the ESM to finance health expenditures related to the pandemic; (3) agreement on the EIB proposal of a 25 billion guarantee fund; (4) agreement to work on a Recovery Fund to relaunch the economy, promote convergence and avoid the fragmentation of the single market, whose details will be decided by the Council of the European Union.