Statement by Executive Vice-President Margrethe Vestager on State aid measures to address the economic impact of COVID-19

_Vestager_

Co-operators: Photographer: Lukasz Kobus European Union, 2020 Source: EC – Audiovisual Service

This article is brought to you in association with the European Commission.


The outbreak of COVID-19 affects all of us and our goal today is to bring together all of Europe’s resources to tackle this unprecedented situation.

It is both lives and livelihoods that are at stake. Businesses all over Europe – and in particular smaller ones – are struggling with the effects of the actions that governments have had to take, to slow the spread of this virus. So, the European Commission will work quickly and decisively, to help governments use their resources to help citizens and businesses.

Our goal here is to make sure that businesses have the liquidity they need to keep operating, and to make sure the support reaches the companies that need it.

And support for businesses in one Member State must not undermine the unity that Europe needs, a unity that will take us through this crisis. We have to be able to rely on the European single market, to help our economy weather the outbreak, and bounce back strongly afterwards.

Many Member States are taking action. We’ll work closely and quickly with them to help them provide the support which the economy needs. And in a way that limits harm to the single market. As part of that, we will give advice and share templates of schemes that work well.

There are many ways governments can help, without needing state aid approvals.

They can give all businesses, throughout the economy, a breathing space to help them cope – providing wage subsidies, or suspending corporate tax payments or payments of VAT.

But we will need to do more – and the European rules on state aid enable governments to take effective action. To name just three examples on how to compensate for damages and provide liquidity to companies.

First, some sectors, like tourism, transport or hotels and restaurants, they are hit especially hard. So we’re working with governments to put in place schemes that compensate sectors for the damage they have suffered because of the COVID-19 outbreak.

Wednesday, we received the first notification of state aid to tackle the effects of the COVID-19 outbreak. The Danish government submitted its plans to compensate companies that had to cancel events with more than 1000 people. We signed off on those plans within 24 hours.

We will work just as fast with any other Member State that want to introduce schemes to compensate businesses for the damage, which COVID-19 outbreak causes. And of course, governments can also help individuals directly – this doesn’t need State aid approval. For instance, they might decide to reimburse people for tickets to cancelled events.

The second example is that our State aid rules enable governments to put in place schemes that give Small and medium-sized companies the urgent liquidity they need. Already, nine Member States have that sort of scheme in place – and we will work with others who’d like to do the same, or to increase the budgets of existing schemes.

My third example has to do with banks. Because our economy’s ability to weather such an unprecedented situation will also depend on banks, and their readiness to lend. And some governments may want to use banks as a channel for support to the economy – including to Small and medium-sized companies.

We will work with governments on this. Today, more than a decade after the financial crisis, European banks are stronger and more resilient. If need be in the coming weeks and months, we do have the rules in place to enable governments to ensure banks have adequate liquidity to lend to their customers.

The situation we’re dealing with is changing fast. There’s every possibility, a high risk, that the strains on our economies will grow. Governments may need to give state aid on a much larger scale. And our rules allow for wide-ranging support, throughout the economy, in Member States that are facing a serious disturbance to their economies.

As I already said on Tuesday in this pressroom, that’s the case in Italy. And the situation in more and more Member States is going in the same direction.

So we’re keeping a very close watch on the situation in all Member States, and staying in close contact with governments. And we are ready to respond as we did in 2008, at the time of the financial crisis. At that time, the Commission adopted a Temporary Framework, guiding Member States as to how to use state aid to help stabilise the European economy, while protecting the single market. And we’re now working on a new framework, so that we have it ready, if it becomes necessary.

What matters right now, is that we are prepared to move fast.

This is why we’ve put in place all the procedures we need, to deal with new state aid very fast. That includes a hotline, which is open seven days a week, for public authorities to raise questions, to ask for advice, to ask a template, in order to give aid to cope with the effects of the COVID-19 outbreak.

The European Commission will continue to provide the necessary support to governments and citizens.

the sting Milestones

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Here’s how tech can help governments fight corruption

Khashoggi trial in Saudi Arabia falls short of independent, international probe needed: UN rights chief

Mobile technology saving lives: Changing healthcare systems with simple technology solutions

Tuesday’s Daily Brief: Venezuela-Colombia baby breakthrough, Italy piles on rescue boat pressure, States must combat hate, Kashmir rights latest and a musical plea to combat CAR hunger

Climate change will force us to redefine economic growth

This AI can predict your personality just by looking at your eyes

Northern Ireland: Parliament wants to secure post-Brexit regional funding

UN launches Facebook Messenger-powered bot to take on climate change

Keeping cool in the face of climate change

‘Favour dialogue’ over violence, UN chief urges all parties following clashes in Mali’s capital

Building climate resilience and peace, go hand in hand for Africa’s Sahel – UN forum

Being blinded by labels stops social change. Art helps us see a better future

Here’s why upskilling is crucial to drive the post-COVID recovery

UN, African Union make significant joint commitment to global health

Protecting refugees in Europe: UNHCR calls for a ‘year of change’

Yemen: UN envoy asks Security Council for more support ‘to move back’ to the negotiating table

Is the EU denying its social character favouring a banking conglomerate?

UN rights chief Bachelet appeals for dialogue in Sudan amid reports ‘70 killed’ in demonstrations

How the US should react to the pandemic, according to Bill Gates

One million facing food shortages, nutrition crisis after Mozambique cyclones: UNICEF

4 ways Africa can prepare its youth for the digital economy

UN agencies launch emergency plan for millions of Venezuelan refugees and migrants

Do doctors need to know their patients’ sexual orientation and gender identity?

The next 48 hours may change the European Union

The UK referendum has already damaged Europe: even a ‘remain’ result is not without cost to Britain and the EU

Mali facing ‘alarming’ rise in rights violations, warns UN expert

A European Discovers China: 3 First Impressions

5 things to know about African migration

MWC 2016 LIVE: GTI shifts to phase two – 5G – after hitting milestones

If we want to solve climate change, water governance is our blueprint

Minsk “ceasefire” leaves more doubts than safety, with EU already planning steps further

Trade: First year of the EU-Japan Economic Partnership Agreement shows growth in EU exports

Electronic Cigarettes: Are they really as safe as we think?

UN and African Union in ‘common battle’ for development and climate change financing

Parallel downfalls of Merkel and Deutsche Bank threaten Germany and Europe

For video game addiction, now read official ‘gaming disorder’: World Health Organization

A new proposal breaks the stalemate over the Banking Union

To Brexit, or not to Brexit…rather not: 10 Downing Street, London

AI can be a game-changer for the world’s forests. Here’s how

What young people can teach world leaders about mental health in 2020

How can you or your organization support the Hour of Pride initiative?

Why do humanitarian crises disproportionately affect women?

Russia and the West to partition Ukraine?

Uzbekistan wins its long fight against malaria, as global rates continue to rise

Clean air is good for business

These are the world’s 20 most dynamic cities

Making the most of the Sustainable Development Goal 3: its overlooked role in medical education

Capital transaction tax on Ecofin table

International Women’s Day 2019: more equality, but change is too slow

An all-out fight for the EU budget

World Digital Media Awards winners announced at WNMC.19 in Glasgow, in association with The European Sting

Millennials (and Gen X) – Here are the steps you should take to secure your financial future

Forget GDP – for the 21st century we need a modern growth measure

David Attenborough’s worried about this ocean threat – and it’s not plastic

Is this the way to finally beat corruption?

80 adolescents a day will still die of AIDS by 2030, despite slowdown in epidemic

UN ceasefire monitoring chief tours Yemeni port of Hudaydah

DR Congo elections: ‘historic opportunity’ for ‘peaceful transfer of power’ says Security Council

Consumers’ rights against defective digital content agreed by EU lawmakers

Parliament mobilised to channel EU funds to those affected by Coronavirus pandemic

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s