A new Marshall Plan | How to recover the European economy
The following article was written by Dr2 Consultants, an EU Public Affairs agency. Hezelburcht and Dr2 Consultants have joined hands in order to share knowledge. By doing so, we are able to better inform our clients with quality content regarding European affairs!
Following the rapid succession of contingency measures to mitigate the impact of COVID-19 on the European economy, the EU is now preparing for the post-COVID-19 era.
In recent weeks, the Commission announced various sets of contingency measures to mitigate the impact of the COVID-19 outbreak on the European economy and health system. As the spread of the virus seems to slowly stabilize, the focus is shifting towards gradually re-opening the economy. The anticipated recovery measures for the post-COVID-19 era are expected to have a significant impact on the EU budget and the EU policy agenda.
A coordinated exit strategy
So far, Member States don’t seem to agree yet on a coordinated exit strategy. The Commission recently published – by request of the European Council – a roadmap on the relaxation of contingency measures across the EU and prerequisites for an effective ‘exit’ out of the current crisis. However, in the process of developing the exit strategy, European capitals criticized the Commission for failing to consult the Member States, and the Commission was asked to tone down the content of the strategy. The result: a watered down ‘roadmap’ issuing nothing but recommendations to Member States. In the meantime, various Member States (e.g. Austria, Czech Republic, Denmark) started implementing national exit strategies.
Changing priorities, changing agenda
The COVID-19 outbreak has significantly shaken up the policy agenda of the Commission. As a consequence, the Commission has to re-order its priorities. Several policy initiatives now face delays or are postponed. The Commission is expected to publish a revised work program for 2020 by the end of April, but Dr2 Consultants has already obtained a draft version. The focus is in first instance on those policy initiatives that will directly contribute to overcoming the COVID-19 crisis. Other initiatives may be postponed until the EU returns to business as usual.
The MFF as catalysator for economic recovery
EU leaders are already thinking about a long-term recovery plan for Europe, often dubbed the ‘new Marshall Plan’, referring to the massive grant scheme provided by the US to stimulate the European economy after World War II. According to Commission President Von der Leyen, the next multi-annual financial framework (MFF) (2021-2027) should be at the heart of the long-term recovery of the European economy. The Commission is expected to present a revised proposal for the seven-year budget by the end of April.
In a quest for European solidarity, the ‘new’ MFF will require additional firepower from EU capitals in order to overcome the anticipated economic recession. Moreover, the MFF will inevitably lead to a new allocation of funds for the various EU funding instruments, possibly impacting the available funds for instruments relevant to your organization. With reference to the recent series of heated Eurogroup meetings, the upcoming negotiations on the MFF are expected to be long and intense.
Connecting your business with the EU
In the challenging context of COVID-19, it is crucial to remain up-to-date with the latest developments in order to anticipate on opportunities and threats and mitigate the impact on the daily business operations. Dr2 Consultants supports your organization in getting a better grip on the contingency and recovery measures that are announced at EU level.