Statement on COVID-19 economic policy response

March 17, 2020

Following up on the videoconference on 10 March 2020 between European Council Members, as well as the ECB President, the Eurogroup President and the High Representative, the Eurogroup held an in-depth discussion today, together with non-Euro Area Members, on how to respond to the extraordinary human and economic crisis caused by the Corona virus.
The Eurogroup expressed its sympathy and solidarity with the citizens and the Member States particularly hit by this crisis and its gratitude to those risking their own health to save lives. The Eurogroup is following the situation very closely and is in permanent contact and coordinated to give a strong economic policy response to the exceptional situation. Our commitments of today reflect our strong determination to do whatever it takes to effectively address the current challenges and to restore confidence and support a rapid recovery.
Today, we welcomed all the measures taken by Member States and by the European Commission, in particular those taken to ensure that health systems and civil protection systems are adequately provided for to contain and treat the disease, preserve the wellbeing of our citizens and help firms and workers that are particularly affected.
Facing these exceptional circumstances, we agreed that an immediate, ambitious and co-ordinated policy response is needed. We have decided to act and will respond swiftly and flexibly to developments as they unfold. We will make use of all instruments necessary to limit the socio-economic consequences of the COVID-19 outbreak. We have therefore put together a first set of national and European measures while setting a framework for further actions to respond to developments and to support the economic recovery. Preliminary estimates of the European Commission show that total fiscal support to the economy will be very sizeable. We have, so far, decided fiscal measures of about 1% of GDP, on average, for 2020 to support the economy, in addition to the impact of automatic stabilisers, which should work fully. We have, so far, committed to provide liquidity facilities of at least 10% of GDP, consisting of public guarantee schemes and deferred tax payments. These figures could be much larger going forward.
The following measures are part of our co-ordinated responses to protect our economies.
1. All national authorities will allow automatic stabilisers to function and in addition implement all necessary measures to ensure that the economic consequences of COVID-19 are tackled and that they do not put in danger our economic and social achievements. To the extent required by the evolving situation in each country, they will implement temporary measures such as:

    • Immediate fiscal spending targeted at containment and treatment of the disease. Adequate resources will be provided to our health sectors and civil protection systems;
    • Liquidity support for firms facing severe disruption and liquidity shortages, especially SMEs and firms in severely affected sectors and regions, including transport and tourism – this can include tax measures, public guarantees to help companies to borrow, export guarantees and waiving of delay penalties in public procurement contracts;
    • Support for affected workers to avoid employment and income losses, including short-term work support, extension of sick pay and unemployment benefits and deferral of income tax payments.

2. Coordinated efforts at the European level will supplement national measures:

    • We welcome the Commission’s proposal for a €37 billion “Corona Response Investment Initiative” directed at health care systems, SMEs, labour markets and other vulnerable parts of our economies, and to make a further €28 billion of structural funds fully eligible for meeting these expenditures. We agreed on the need to implement the necessary legislative changes as quickly as possible;
    • We welcome the initiative of the Commission and the EIB Group to mobilise up to €8 billion of working capital lending for 100,000 European firms, backed by the EU budget, by enhancing programmes for guaranteeing bank credits to SMEs. We also support the ongoing efforts of the Commission and the EIB Group to increase this amount to up to €20 billion, which would reach a further 150,000 firms. We also welcome the ongoing work to make further funds available as swiftly as possible and to enhance the flexibility of the financial instruments leveraged;
    • We welcome the initiative of the EIB Group to catalyse €10 billion in additional investments in SMEs and midcaps for their own account and to accelerate the deployment of another €10 billion backed by the EU budget;
    • We invite the EIB to further enhance and accelerate the impact of the available resources, including through enhanced collaboration with the National Development Banks;
    • We also welcomed the package of monetary policy measures taken by the ECB last week aimed at supporting liquidity and funding conditions for households, businesses and banks, help the smooth provision of credit to the real economy, and avoid fragmentation of euro area financial markets in order to preserve the smooth transmission of monetary policy.

3. Beyond the immediate, targeted response, we are working on all the necessary measures, to help the economy recover once the coronavirus has receded. We acknowledge the need to reflect on the resilience of our European strategic value chains to better protect Europe from product and capital market disruptions in the future. We have already significantly strengthened our crisis management framework, including with the establishment of the ESM. Today we recommit to continue our work to further strengthen the architecture and resilience to shocks of the Economic and Monetary Union.
Our shared rules will support this response. In particular, we discussed the application of the SGP, state aid rules and prudential rules:

  • The economic shock of the coronavirus, with an economic contraction now expected this year, together with the cost of our agreed measures, will have a substantial budgetary impact. The SGP has the flexibility needed to cater for this situation and we will make full use of this flexibility in all member states.
  • Automatic stabilisers will fully play their role. This means that automatic revenue shortfalls and unemployment benefit increases resulting from the drop in economic activity will not affect compliance with the applicable fiscal rules, targets and requirements. In addition, we agreed that the budgetary effects of temporary fiscal measures taken in response to COVID-19 will be excluded when assessing compliance with the EU fiscal rules, targets and requirements. This includes the budgetary impact of temporary and targeted measures, such as those urgently needed to contain and treat the pandemic, ensure liquidity support to firms and sectors, and protect jobs and incomes of affected workers. The flexibility to cater for unusual events outside the control of government is applicable to the current situation. We welcome the readiness of the Commission to activate the general escape clause, allowing for further discretionary stimulus, while preserving medium-term sustainability.
  • We welcomed the Commission guidance on the scope for supporting firms that is available within state aid rules in the current circumstances, together with the Commission announcement that it has accelerated its state aid approval processes. The Commission has announced it will approve additional measures needed to remedy this serious disturbance in the economy, which is already the case for Italy and increasingly across the EU. Taking urgent action and making full use of the flexibility foreseen in the state aid rules is necessary to cushion the effect of the crisis for those companies and sectors which are affected, whilst ensuring a consistent framework and a level playing field in the single market. The Commission stands ready to issue a specific framework shortly.
  • The banking system has a key role in preventing this health emergency from turning into a social and economic crisis for businesses and households. We therefore welcomed the statement by the European Banking Authority that competent authorities should make full use, where appropriate, of the flexibility embedded in existing regulation to support the banking sector in view of the current exceptional circumstances.
  • In particular, we also welcomed the decisions taken by ECB Banking Supervision providing temporary capital and operational relief to euro area banks, with a view to ensuring that supervised banks can continue to fulfil their role in funding the real economy as the economic effects of the coronavirus become apparent. Such flexibility is needed to avoid, as much as possible, pro-cyclical, unintended consequences for the financial sector.

We will take whatever further coordinated and decisive policy action is necessary, including fiscal measures, to support growth and employment.

Additional Articles

Ambassadors are Like Rabbis: Reflections from Our Advisory Board Member Rabbi Binyomin Jacobs

Every Day during the Corona crisis our Advisory Board Member Chief Rabbi Binyomin Jacobs (NL) writes a diary, on request of the Jewish Cultural Quarter in Amsterdam,  which is published on the website of the NIW, the only Jewish Dutch Magazine. Rabbi Jacobs is the head of Inter Governmental Relationships at the Rabbinical Centre of Europe. We will be regularly publishing a selection of his informative, sometimes light hearted, but always wise pieces.
For our Dutch readers you can follow the diary every day at NIW home page: https://niw.nl and then: scroll down.
Ambassadors are like Rabbis…
Today was all about abroad. The Ambassador of Hungary had invited me to lunch at his embassy. We have known each other for a few years, meet from time to time and so again today. Reason for the visit? No. Just catching up again about kosher slaughter, which was threatening to become a problem in Poland and the relationship between Hungary and Israel.
Because it would not be exactly easy to arrange a kosher meal at the Hungarian embassy, ​we (my wife and I) invited him to lunch with us.
So,the ambassador came to Amersfoort and we not to The Hague. Not wanting to come empty-handed, he brought a huge bouquet of flowers and a bottle of kosher wine.
How did he get that wine? The ambassador called his friend Naor (the ambassador of Israel) and he arranged for a bottle of kosher Israeli wine from the IPC – the Israel Products Center – in Nijkerk to be delivered to the Hungarian embassy that morning. And because the Ambassador of Hungary did not know about the existence of the IPC, which is ten minutes from my house, I took him there after lunch. Of course I made sure that in addition to the tour and explanation about the objective of IPC and Christians for Israel, he also received a pack of cookies. Because: tomorrow the ambassador of Israel will visit the Hungarian ambassador and then it seemed nice that I then pay back the bottle of wine via a roll of kosher Israeli biscuits.
Apart from that, I gave the ambassador a mask with “I love Israel” on it, so that the Hungarian ambassador can wear it when the Israeli ambassador comes to make his appearance.
Networking is something like that. Usually it does not deliver on the spot, but is important nonetheless. Ambassadors do no different, and are a bit like rabbis, at least my kind of rabbis.
Because I believe that the rabbi is of course primarily there for the Jewish community in its full breadth. But for that Jewish community, contact with outside that community is also of vital importance, because we are part of the wider society: Noah had to leave the Ark by order of Gd!
Apart from the importance for the Jewish community, we also have a duty, in my opinion, to contribute to the well-being of the surrounding society. Yesterday I had a visit from another kind of ambassador, namely Dr. Pieter de Boer, member of the deputy Church and Israel of the CGK-Christelijk Gereformeerde Kerken- and spokesperson of the Interkerkelijke Werkgroep. That Working Group had drawn up a statement of guilt on the attitude of the churches during and shortly after the war. Today, that statement of guilt was officially released.
Although for me such a debt declaration is not really necessary, I was especially touched by the comment about what went wrong after the war. My grandfather and grandmother’s nephews and nieces were not allowed to be raised with my grandfather and grandmother, but were to remain in the Christian homes where they had been in hiding. Of course, those parents had bonded with the kids, saved their lives, but … they really hadn’t given up their murdered parents with the intention of being raised as Christians.
And whilst with the ambassador: a phone call from Ukraine. One of the rabbis was in a conflict with Christians for Israel supporting him with an adoption project. People in the Netherlands adopt a poverty-stricken Jewish family in Ukraine for € 25 per month. In Kirovograd, communication between the Dutch donors and the local rabbi did not go well. And so I get a call from the rabbi and start mediating or solving, as a kind of ambassador of whom I really don’t know, but I am somewhere in between.
After the necessary phone calls, I hope that I have been able to straighten everything out again and that it also runs smoothly in Kirovograd. What is difficult here is that the local rabbi speaks fluent Russian, but no Yiddish, poor English and not optimal Hebrew, and certainly no Dutch! But I believe I’ve been able to tie things together again. In the meantime, I am waiting for the results of an archival investigation to confirm someone’s Jewishness. I feel that it can be checked that way, but not everyone shares my opinion that (almost) everything should be tackled immediately. In principle, I always answer e-mail immediately.
As a result, I sometimes spend late at night behind that stupid computer that has been controlling my whole life!
But Good news! At least in my opinion. Because, of course, it is really not the case that a hundred listeners are more important than ten at a lecture, and the same goes for the number of readers of my diaries, still, I have to admit my weakness in this, I like that my diaries are getting wide read. And so: Good news for me! Coincidentally (although I really believe that coincidence does not exist) the EJA –European Jewish Association- saw one of my diaries, translated it with Google and asked permission to post this diary a few times a week on their website and their Facebook. And thus more readers. My diary is going European!

New Proposed Bill Limiting Kosher Slaughter In Poland. 

Watch European Jewish Association Chairman, Rabbi Menachem Margolin speaking on the subject of the new proposed bill limiting kosher slaughter in Poland.

Vice Presidents Jourová and Schinas speak at 4th meeting of Working Group on Antisemitism

On 8 December, Vice-President Věra Jourová and Vice-President Margaritis Schinas participated in the 4th meeting of the Working Group on combating antisemitism. Vice-President Schinas opened the meeting with remarks on stepping up the fight against antisemitism, while Vice-President Jourová will deliver closing remarks in the afternoon. The meeting was focused on the development of national strategies against antisemitism, the practical use of the International Holocaust Remembrance Alliance (IHRA) definition of antisemitism, and fighting against antisemitic prejudices as part of civic orientation measures based on the EC Action Plan on Integration and Inclusion.
Values and Transparency Vice-President Věra Jourová said:  ‘It is more important than ever to think critically, to not believe immediately what you read and hear. Countering disinformation and promoting democracy are crucial principles to our democratic societies and to the functioning of the European Union.”
Vice President Schinas said: “In 2021 we will present with our first comprehensive EU strategy on combating antisemitism. Our message is clear: Europe is determined to win this fight. Europe is proud of its Jewish communities and stands by its Jewish communities.”
The European Commission created the ad-hoc Working Group on antisemitism within the existing high-level member states expert group on racism and xenophobia to help member states in the implementation of the Council Declaration on the fight against antisemitism and the development of a common security approach to better protect Jewish communities and institutions in Europe of 6 December 2018. More information on the Commission’s work to tackle antisemitism can be found here.
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83 years after Kristallnacht, Jewish leader warns: Europe can become ‘Judenfrei’ in 10 years

“There are more Jews in Europe who think that there will be no more Jewish community here in a decade than those who think that there is still hope,” declared Rabbi Menachem Margolin, Chairman of the European Jewish Association, writes Yossi Lempkowicz.
“I am not saying that in ten years you will not be able to see Jewish people in Europe but I am very worried about the possibility to have Jewish presence in ten years from now,” he added as he addressed 160 ministers, parliamentarians and diplomats from across Europe who gathered for two days in Krakow, Poland, to discuss ways to increase Holocaust education and remembrance, fight against antisemitism and develop tools to combat hate speech and incitement in the age of social networks.
The gathering included also a tour of the Auschwitz-Birkenau death camps where a candle lighting ceremony and wreath laying were held in the presence of Rabbi Meir Lau, former chief Rabbi of Israel and President of the Council of Yad Vashem, the Holocaust Memorial in Jerusalem.

Among the speakers at the conference were Moroccan Minister of Culture and Youth Mohamed

Mehdi Bensaid, Roberta Metsola, European Parliament Vice-President, Hungarian Minister of Science and Education Zoltan Maruzsa, Minister of Education of Rhineland-Palatinate Stefanie Hubig, British Secretary of State for Education Nadhim Zahawi, as well as the Speakers of the Parliaments of Slovenia and Montenegro.
The conference took place on the 83rd anniversary of Kristallnacht, the night of Broken Glass, when on 9 November 1938 the Nazis started the anti-Jewish pogroms by  killing Jews, burning 1400 synagogues and destroying shops owned by Jews across Germany and Austria.
“Europe is fighting anti-Semitism, but it is not winning yet. If this upward trend continues, more and more Jews will seek sanctuary in Israel rather than stay in a continent that cannot learn the lessons and cataclysmic mistakes of its past. We are not yet in the state of Judenfrei but, unfortunately we are approaching it,’’  Rabbi Margolin emphasized.
He noted that Jews who seek to eat according to the customs of their religion cannot do so in certain countries because of laws banning kosher slaughter. And in some cities on the continent Jews cannot walk safely in their traditional clothes.
“Education, he said, is the most effective vaccine in combatting the world’s oldest and most virulent virus.”
Addressing the symposium in a video from Jerusalem, Israeli Prime Minister of Israel Naftali Bennett said: “In the Middle Ages Jews were persecuted because of their religion. In the 19th and 20th centuries Jews were reviled because of their race, and today Jews are attacked because of their Nation State, Israel.”
“It is worrying that there needs to be a conference about Anti-Semitism in Auschwitz so soon after the Holocaust,” the Israeli premier said, adding that “so long as Israel remains strong, Jewish people around the world will be strong.”
British Secretary of State for Education Nadhim Zahawi stated that: “The Holocaust was a failure for humanity and justice. The worst event in history. Nothing can erase the pain. I can feel the pain because my whole family has run away from Saddam Hussein’s rule. As Kurds, we had to escape. We fled when I was 7 years old from Iraq to the UK.”

The symposium in Krakow was followed by a visit of the Auschwitz-Birkenau death camps where a candle light ceremony and wreath laying took place.

He added: “I understand the important role of UK teachers in Holocaust education. Learning about history is something we sanctify in the UK. Due to the corona, virtual visits to Auschwitz increased. We have zero tolerance for anti-Semitism and racism. Anti-hate education is our top priority in the UK. I urge universities to adopt the IHRA definition of anti-Semitism,” he said in a reference to antisemitism  on campuses.
German Minister of Education of the Rhineland-Palatinate State, Stefanie Hubig  said: “I work hard to preserve the memory of the Holocaust in schools. We work to bring teachers to visit memorial sites and promote Jewish education in schools. This is all important because, unfortunately, there are still reasons why we must continue to remember.”
In a message from Rabat, Moroccan Minister of Culture and Youth, Mohamed Mehdi Bensaid, stressed that this conference is taking place at a time when more and more radical ideologies promoting anti-Semitism, Islamophobia and xenophobia are flourishing. “As long as the danger of radicalism hovers over the world, we all have a duty to remind and teach our younger generation in Morocco and around the world about the dark chapter of the Holocaust in human history.”
Kálmán Szalai, secretary of the European Action and Protection League (APL) identified education as an important means of reducing anti-Semitic prejudice and emphasized that “the knowledge passed on to new generations can fundamentally influence the choice of values in adulthood”.
A recent survey by the APL showed the persistence of anti-Jewish prejudices in the population of several countries in Europe.

83 years after Kristallnacht, Jewish leader warns: Europe can become ‘Judenfrei’ in 10 years

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