EU leaders will discuss on Friday 25 June what components are needed to ensure a strong economic recovery in the EU as the Covid-19 vaccination is rolled out across the continent.
“It will be a forward looking discussion on what is needed to ensure a long term recovery”, said an EU source on Wednesday 23 June. The source also cited how important the banking union in the euro area and the capital markets union would be in stimulating economic activity.
The EU-27 will take stock of the implementation of the Next Generation EU Recovery Plan, including the recovery plans that Member States have to submit at a European level in order to receive financial support in the form of grants and possibly loans.
At this stage, 24 Member States have sent their national plans to the European Commission. The Commission has recommended the adoption of twelve recovery plans (for Austria, Belgium, Denmark, France, Germany, Greece, Italy, Latvia, Luxembourg, Portugal, Slovakia and Spain).
More information is available here on those plans for which an analysis has been finalised: https://bit.ly/3gG3k0D
The Ecofin Council is invited to formally adopt these plans on Tuesday 13 July so that they can be pre-financed from the €20 billion package already raised on the capital markets by the European Commission on behalf of the EU-27 (see EUROPE 12741/6).
In the Netherlands, the procedure for analysing recovery plans has to go through the national parliament. The Netherlands has also requested and obtained the introduction of an ‘emergency brake’ – but not a veto – which allows any national plan deemed to be problematic to be discussed at European Council level.
More generally, EU leaders will express their satisfaction that the economic recovery should be more robust than had been expected in July 2020 at a time when the EU budget for 2021-2027 was agreed.
“Member States must do their best to revive their economies and reduce their public debt perhaps quicker than anticipated, since the recession is less severe”, said one national diplomat.
On Friday, the exchanges that take place should set in motion a process for the coming months during which there will be discussions “on what to do to avoid losing the technology race and on the issue of public debts”, said another diplomatic source.
It should be noted that, according to the draft European Council conclusions, EU leaders will call for rapid progress to be made in respect of negotiations on international tax reform in the G20 and OECD fora. Luxembourg would like to remove the reference to the G20.
Euro Summit. Under the ‘enlarged euro area’ format, the EU-27 is set to take note of the work carried out at the Eurogroup level regarding the completion of the banking union in the euro area.
Contrary to the mandate received at the end of 2020 by the Euro Summit, the Eurogroup failed, in June, to come to an agreement over a work programme on all issues related to financial risk sharing and reduction (see EUROPE 12743/8).
Read the draft conclusions dated 21 June: https://bit.ly/3zOc3Xq (Original version in French by Mathieu Bion with the editorial staff)