COVID-19: MEPs urge quick action to prevent “huge recession”

covid rich

(Credit: Unsplash)

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

In an EP webinar on the EU’s long-term budget and response to the crisis, MEPs urged that the recovery fund must be set up as soon as possible to prevent a major recession.

In Tuesday’s EP webinar for journalists on the EU long-term budget and Europe’s economic recovery plan, MEPs welcomed the recent French-German proposal for a €500 billion recovery fund and reiterated Parliament’s position on the recovery plan as adopted in the recent plenary session.

Parliament will hear Commission President von der Leyen present the revised Multiannual Financial Framework (MFF) and recovery plan proposals and hold a debate in plenary session on the afternoon of Wednesday 27 May.

Johan Van Overtveldt (ECR, BE), Chair of the Committee on Budgets, warned that the current economic situation might be getting out of hand and demanded quick action: “COVID-19 is still is a major health crisis, and we realise that, slowly but surely, it is transforming into a huge recession. In the coming days and weeks, we have to work out how to reconcile solidarity with responsibility. […] If we don’t stop the recession in its tracks as soon as possible, we might be confronted with what I define as a new financial hurricane.”

José Manuel FERNANDES (EPP, PT), co-rapporteur for the EU’s Own Resources (EU revenue), said that the French-German initiative is a “step in the right direction” and underlined that the recovery fund is needed immediately, as the MFF will not be in place before 2021. On member states’ reticence until now to agree on a robust long-term budget, Mr Fernandes said: “Member states do not say to what extent they want to cut cohesion or agriculture funding. They want to keep their envelopes. They all want to increase research funding. The Commission wants a ‘geopolitical Europe’ and to finance the Green Deal. We therefore need the means to honour these commitments.”

Margarida MARQUES (S&D, PT), co-rapporteur for the MFF, insisted that the recovery fund must be anchored to the MFF. “The EU’s answer to the crisis is based on the MFF and the recovery fund. The MFF can also be a platform to access other financing sources, like the EIB or the ESM.” The three main priorities now are to “repair the internal market in the wake of state aid measures, set up the economic and social recovery plan and, thirdly, increase the EU’s resilience.”

Valérie HAYER (Renew, FR), co-rapporteur for the EU’s Own Resources, said: “According to the Commission’s latest forecasts, the EU economy will face a 7.5% GDP decrease in 2020. That is tragic. It corresponds to around €1 trillion. The EP is asking for a €2 trillion plan that should include loans but mostly grants.”

On the French-German initiative, Ms Hayer highlighted: “It goes in the right way – the Parliament’s way. The two countries agreed to raise common debt […] and on direct spending, and that is very important.” She welcomed that the initiative leaves the door open to introduce new Own Resources to pay back the debt.

Luis GARICANO (Renew, ES), also highlighted new Own Resources as a useful initiative: “The key issue is how to fund this package. The Parliament here is very clear. It offers member states a good bargain: we realise that EU countries have limited abilities to increase their direct contribution to the EU budget. We think that there is a comparative advantage in collecting certain types of revenue, for example a digital tax that allows member states not to increase their contribution. Let’s raise taxes from these sources of revenue which are now unexploited and help pay the interest on this long-term debt generated by the recovery plan.”

Ernest URTASUN (The Greens/European Free Alliance, ES) said: “The recovery fund must not be created at the expense of the MFF. It would be a bad solution to have a strong recovery fund frontloading MFF spending, and then have a very weak MFF in three or four years’ time. We need both: a strong recovery fund and a strong MFF, because after the recovery, the urgent climate and digital challenges will remain.”


As the current long-term EU budget runs out on 31 December 2020, the EU needs a new budgetary planning horizon for the next seven years. The EU Commission thus presented plans for the next MFF for 2021-2027 in May 2018. Parliament adopted its position in November 2018, and re-confirmed it in October 2019, updating it recently through two plenary resolutions on 17 April and on 15 May 2020. The Council has not yet been able to agree on a position.

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

The role of students in a migration crisis in Roraima, Brazil

Why the next 4 months are crucial to the future of the ocean

5 things you may not know about Dubai

These are the best cities for tech

Who holds the key to the future of biotechnology? You do

Despite progress towards peace, Afghanistan facing ‘daunting challenges’ ahead of presidential vote

A Sting Exclusive: “China-Africa Cooperation Sets a Fine Example of South-South Cooperation”, by China’s Ambassador to EU

Engaging ‘head and mind’, key for effective learning, says UNESCO chief on Literacy Day

Who should pay for workers to be reskilled?

Taxation: Commission refers Poland to Court for failing to remove certain tax exemptions on the use of energy products by highly polluting businesses

Can Eurozone stand economic and financial fragmentation?

Google strongly rejects EU antitrust charges and now gets ready for the worst to come

Negotiated two-State solution still ‘the only option’ for Palestine: Guterres

From cheeseburgers to coral reefs, the science of decision-making can change the world

This solar-powered car lets you drive for free

Terrorist content online: MEPs agree to start negotiations with EU countries

Legal Manager – 2050

More attacks, ‘persisting security challenges’ threaten progress in West Africa, Sahel

State aid: Commission approves amended Estonian scheme worth €450 million to support production of electricity from renewable sources

6 things to know about the General Assembly as UN heads into high level week

We must give young people a platform to lead the COVID-19 recovery

Accountability for atrocities in Myanmar ‘cannot be expected’ within its borders – UN investigator

Drought in Europe: the Commission offers further support to European farmers

The vegan economy is booming – and Big Food wants a slice of it

2020 Blue Economy Report: Blue sectors contribute to the recovery and pave way for EU Green Deal

The Indian miracle state pointing the way to global sustainability

An electric motorbike could help tackle big game poaching. Here’s how

Business management: how can you introduce new ideas?

Deepfake democracy: Here’s how modern elections could be decided by fake news

State aid: Commission approves €30.5 billion French scheme to support production of electricity from renewable energy sources

Could implants treat people with brain disease? A young scientist explains

State aid: Commission approves €2.5 billion Italian scheme to support self-employed and healthcare professionals in context of coronavirus outbreak

Is data privacy a thing of the past in a digital world?

EU Covid-19 Certificate: a European solution for free testing is needed

State aid: Commission approves Luxembourg guarantee measure to further support economy in coronavirus outbreak

The European Union’s road to sustainability – how each EU state is doing

‘Ground Zero’: Report from the former Semipalatinsk Test Site in Kazakhstan

A record number of College members travel to Addis Ababa for the 10th European Union-African Union Commission-to-Commission meeting

Conference on the Future of Europe: Engaging with citizens to build a more resilient Europe

EU accused of being too nice with Gazprom in the infamous antitrust case

Agriculture and Fisheries Council

Mergers: Commission opens in-depth investigation into proposed acquisition of Transat by Air Canada

China Unlimited: an exclusive interview with the former Ambassador of Hungary to China

MEPs back plans to promote water reuse for agricultural irrigation

COVID-19 has been a setback for women. Gender-responsive policies can stem the losses

Impact Investment needs global standards and better measurement

Commission welcomes confirmation of provisional agreement to strengthen collective redress in the EU

Global OECD welcomes Colombia as its 37th Member

‘Lighthouse’ factories are more productive than ever. Business leaders explain how they do it

Yemen consultations have started, insists top UN negotiator

Parliament commemorates the liberation of Auschwitz 75 years ago

Better transit metrics could bridge equity gaps. Here’s how

How AI can inspire doctors to be more inventive

The three biggest challenges for India’s future

The elephant and the mouse: how corporate giants can avoid trampling on their stakeholders

The gender gap of medicine in 2018

Pakistan-India crossing is a ‘Corridor of Hope’, UN chief says, wraps up visit with call for interfaith dialogue

The secret to ending war? It’s too easy: more women in peace negotiations

Time to say goodbye to the plastic straw. But what’s the best alternative?

World ‘not yet on track’ to ensure children a better future: UN rights chief

More Stings?

Speak your Mind Here

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

You are commenting using your 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