The pandemic and the economic, political and social damages suffered required a greater effort on behalf of the European Union to cope with the difficulties faced by the Member States. The fear was that of not being prepared to face this challenge, but the resilience of the Union has shown that instruments requiring Communitarian action are able to maintain the values that allow us to be ‘united in diversity’.
Let us begin by discussing the instruments put in place by the European Union in support of businesses and employment. What are the main instruments used for a solid and Community recovery?
In this new journal article, we offer an overview of the European policy instruments and actions aimed at supporting its citizens: Next Generation EU, SURE and ESM.
THE ECONOMIC POWER OF A RESILIENT UNION
The European Union provides for important resources, direct and indirect funding lines to support companies and work. The former is managed by the European Commission with transnational projects and programmes that can often be accessed directly by companies, groups of companies and associations throughout the European Union. Indirect funds, on the other hand, are traditionally linked to cohesion policies, the so-called European Structural Funds managed by the various States. Important to mention the European Economic Development Fund, the European Social Fund and the Cohesion Fund, which are designed to promote employment, investment and development, particularly in regions with the greatest competitiveness deficits. These are funding lines aimed at infrastructure, energy efficiency, the creation of new opportunities and all those instruments that can be put in place. Today, thanks to the new resources that the Union has made available to the States, new financial instruments are being added. Let us look in detail at the different measures put in place.
This funding line is an unprecedented measure to support employment and work in the face of the dramatic scenario of the pandemic. It is a battle that European democrats have been fighting for a long time to put in place a cyclical unemployment insurance mechanism in Europe, a mechanism to support work and all the social shock absorbers that are used in the various Member States. It is an innovative measure that allows expansionary policies to be made, to behave differently from what happened in the 2008 crisis.
SURE, is to be considered an effective tool for the recovery of those economies most affected by the pandemic, in particular Italy and Spain, characterised by a fragile labour market, high unemployment and low rates of active participation in work.
The measure has been designed to favour those sectors with high seasonality, such as tourism, for example, and is a decisive instrument for economic and social resilience.
This line of credit makes it possible to mobilise a large sum of money for expenditure and investments in the health sector. Therefore, expenditure and investments aimed at strengthening that sector that is suffering the most in the current pandemic scenario.
The conditionality of this instrument is limited to health expenditure and investments, allowing to invest in territorial medicine, telemedicine, in increasing the number of hospital beds, the number of intensive therapies, ….
NEXT GENERATION EU
Given the need to mobilise funds quickly and to think about the future, the European Union has implemented the Next Generation EU plan. For the first time in Europe, a genuine fund has been set up to support the revival and economic recovery of States, financed by issues of Eurobonds, that is, common European debt securities.
The peculiarity of the measure is the very composition of the resources: one part in grants, i.e. non-repayable loans, the other consisting of loans, i.e. low-interest and affordable loans for the Member States. The resources must be legally committed by 2023 and the interventions completed, accounted for and implemented by 2026. This therefore implies a well-defined programming which allows interventions to be implemented within the established period of time.
The areas of intervention are well defined:
The resources put in place by the European Union are unprecedented, demonstrating exceptional resilience, despite the difficulties that emerged from the pandemic. These policies will lead to an economic revival of the continent and greater European integration, making Europe an increasingly authoritative global player.