European Jewish Association

Statement on COVID-19 economic policy response

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:

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

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:

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