The European Finance Ministers will have a first exchange of views on Tuesday 9 June on the Recovery Plan for Europe entitled Next Generation EU, which the European Commission has submitted to the Member States in order to restart the economies paralysed by the Covid-19 pandemic as quickly as possible.
At the end of May, the Commission unveiled a revised proposal for a Multiannual Financial Framework (MFF) for 2021-2027, on which the European Recovery Plan (see EUROPE 12494/2) has been built.
The European institution suggests that €750 billion of the total €1,850 billion should be raised from the markets on behalf of the EU27. These funds would be fully redirected to the MFF to: - finance national recovery plans with a focus on the regions and sectors of activity most affected; - grant extensions to certain Community policies and initiatives such as the CAP, cohesion and the European Green Deal; - provide guarantees to stimulate investment in solvent and/or strategic companies; - learn lessons from the pandemic for the creation of a health programme and the strengthening of the European Civil Protection Mechanism.
On Tuesday, ministers will discuss the structure of the European Recovery Plan and in particular the overall recovery, investment and reform needs of Member States and the link between the plan and the budgetary process of the 'European Semester'.
In its proposal, the Commission suggests analysing the national recovery plans in the light of the socio-economic policy recommendations it sends annually to each Member State to ensure, in particular, that the plans respect the EU's cross-cutting priorities such as the transition to a decarbonised economy by 2050. Once an informal agreement has been reached between the Member State and the Commission, an EU Council committee would give a binding opinion by qualified majority before the Commission definitively endorses the national recovery plan.
With ten days to go before the European summit on Friday 19 June, “we are more at the stage of clearing the way” allowing us to prioritise issues, particularly those that will be decided by the 27 European leaders, a European source said on Monday 8 June.
In the EU Council, the trend is to consider the revised MFF and the European Recovery Plan as a comprehensive package. The lead bodies for preparing the summit discussions are the national ambassadors to the EU (Coreper) and the General Affairs Council, which will meet on Tuesday 16 June. After the summit, we expect “a distribution of duties” in the EU Council on a sectoral basis, this source added, referring to the 20 or so new legislative proposals presented at the end of May, intended to implement the MFF 2021-2027.
In particular, the Ecofin Council will have to negotiate the modification of the InvestEU programme, which will take over from the 'Juncker' investment plan.
Ministers will also take stock of the implementation of safety nets for governments (activation of the European Stability Mechanism credit line, €240 billion), for workers affected by short-time working (SURE instrument, €100 billion) and for companies (pan-European EIB guarantee fund, €200 billion).
On Tuesday, Ministers will also hold their annual meeting in EIB Board of Directors format.
European Semester 2020. The Croatian Presidency will also inform ministers about the finalisation of the draft EU Council conclusions on the 2020 country-specific socio-economic policy recommendations. This year, the year was marked in particular by the freezing of the Stability and Growth Pact to allow Member States to finance the fight against coronavirus and to support their economies (see EUROPE 12491/12).
The Commission and the ECB anticipate an economic downturn of 7.7% and 8.7% of GDP, respectively, at the euro area level in 2020. (Original version in French by Mathieu Bion)