EU finance ministers will meet on Friday 16 April for a meeting that will focus on the post-Covid-19 economic recovery, the Capital Markets Union and the European financial architecture for development.
They were due to meet in Lisbon, but health restrictions linked to the Covid-19 pandemic forced the Portuguese Presidency of the EU Council to postpone its informal meeting until May and instead hold a meeting via video conference on Friday.
Economic recovery. On this occasion, the ministers will once again discuss the economic situation. The European Commission will be invited to share its views on the matter in the run-up to its spring economic forecasts, due in early May. The European Central Bank will also present its assessment.
The Commission’s Executive Vice-President for competition policy, Margrethe Vestager, will also take stock of the implementation of the temporary framework for state aid, adopted in March 2020 (see EUROPE 12639/3) and extended until 31 December 2021.
According to several sources, she is expected to brief ministers on the sectors that have been most affected by the crisis and have benefited the most from state aid, as well as to express her views on the future of this framework.
Ministers will also discuss preparations for national recovery plans since the entry into force of the Recovery and Resilience Facility, the fiscal instrument at the heart of the Next Generation EU Recovery Plan (see EUROPE 12654/1). Denmark, Ireland, Italy and Slovenia will present their draft plans.
The deadline in principle (“as a rule”) to submit its plans to the European level was set for 30 April, but according to the European Commission, no country is yet ready to submit them.
The most advanced countries, according to an EU diplomat, are Spain, Greece, Portugal and France, while others have already indicated publicly that they will be late.
Some Member States may also ask the European Commission at the meeting to shorten the two-month assessment period for national plans under the Recovery and Resilience Facility, especially those that have been in discussions with the Commission on their plans since October.
The European Commission will also present its new funding strategy for Next Generation EU, published on Wednesday 14 April (see EUROPE 12698/2).
For its part, the Portuguese Presidency of the EU Council will take stock of the ratification of the ‘own resources to the EU budget’ decision - a necessary condition for the Commission to pre-finance national recovery plans by borrowing on the markets on behalf of the EU27.
So far, 17 Member States have ratified it, with Belgium officially notifying its internal ratification process on Wednesday. Despite the difficulties encountered by some countries, such as Germany and Poland, the Portuguese Presidency of the EU Council remains confident that the remaining 10 Member States will be able to ratify the ‘own resources to the EU budget’ decision by the end of its Presidency.
Capital Markets Union. The European Commission will also update ministers on the status of the 16 initiatives announced in its September 2020 Action Plan (see EUROPE 12562/9) to accelerate the implementation of the Capital Markets Union (CMU).
In conclusions adopted in December, the Council of the EU asked the Commission to give “the highest priority” to actions that improve the financing of the economy and have the potential to support a rapid post-Covid-19 economic recovery (see EUROPE 12616/20).
The item was requested by the Portuguese Presidency and will focus in particular on the ‘European Single Access Point’, for corporate financial and environmental information, which the Commission is expected to present in the last quarter of 2021. The public consultation on this initiative ended in mid-March and the Commission could already give an overview of stakeholders’ reactions on Friday.
Financial architecture for development. Ministers will also have a further exchange of views on the European financial architecture for development, with a view to reaching EU Council conclusions in the development format in May.
This debate was initiated in October 2019 on the basis of Thomas Wieser’s report and his recommendations to streamline and make the future architecture more efficient, but has not made much progress (see EUROPE 12342/13, 12376/4).
The original aim was to reform the existing structure, including a review of the relationship between the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD), but there have always been two opposing camps in the EU Council. Result: “We should not expect anything revolutionary. It will be the status quo plus”, a European source said on Thursday, referring to “much ado about nothing”. In other words, maintaining the existing structure with some improvements in EIB and EBRD interventions.
“We did not want to make a big mechanism that would have merged the institutions”, summarised another source.
There is a consensus in the EU Council that the ‘status quo plus’ option should be chosen, as the independent feasibility study concluded that it was the most effective and cheapest solution, explained a third source.
Ministers will be asked to comment on their willingness to move forward in this direction, on ways to improve coordination between the EIB and the EBRD, and on concrete steps to be taken quickly and the procedure to be followed.
G20 Finances. Finally, the ministers will be briefed on the outcome of the meeting of G20 finance ministers and central bank governors held on 7 April.
Although not officially on the Ecofin agenda, US proposals on international corporate tax reform could be presented (see EUROPE 12694/11), according to several sources. However, no substantive discussions are expected at this stage. (Original version in French by Marion Fontana and Aminata Niang with Camille-Cerise Gessant)