The main response to the social and economic crisis of the coronavirus, the European recovery fund, has not yet been definitively approved. And Spain is already committed to a review of the measures implemented and planned at the European level. At the moment, what has arrived has already been 6,000 million from the SURE to finance the ERTE and the self-employed affected by the crisis. And the economic vice president, Nadia Calviño, announced this Tuesday before the meeting of the Eurogroup – finance ministers of the euro zone – that before the end of the year another 4,000 will arrive in Spain. In other words, almost half of the 21,300 awarded to Spain from the total fund, which amounts to 100,000 million.
The ECB announces that it will take new measures in December in the face of the impact of the second wave of the pandemic
The health ESM, the 250,000 million of the European rescue fund has not been requested by any country. And, of the 672,000 million in the reconstruction fund – out of a total of 750,000 million – that is managed through governments – and not through European Commission programs – countries are strongly doubting whether to resort to the 360,000 million that correspond to credits.
The Spanish Government, for example, has announced that it will present projects for the 72,000 million subsidies to which it is entitled in the next three years but, for now, it is not going to request the credits – worth 68,000 between now and 2023- . In effect, the reconstruction fund’s capacity to pay may be reduced by almost half if the governments prefer not to request the loans. And, for the moment, both the richest and the least rich countries are easily financed directly thanks, fundamentally, to the 1.35 trillion allocated by the European Central Bank to reduce the pressure on sovereign debts.
Parallel to the decision of the Eurogroup on the health ESM not activated by any country, there are the 200,000 million from the European Investment Bank for guarantees of companies that have just started.
“We are in a context of great uncertainty”, said Vice President Calviño, “there are many challenges we face and today we will review the situation and confirm the unanimous determination of the members of the Eurogroup to continue acting decisively , agile and effective as we have done from the beginning both at the national level and at the European and global level to cushion the economic and social impact of the pandemic “.
The economic vice president understands “that it is a good time, between now and the end of the year, to undertake an evaluation of the instruments that we have equipped ourselves with since the spring, instruments that, I insist, in my opinion, have been tremendously effective. Obviously, the The action of the European Central Bank is key to maintaining financial stability and the liquidity instruments approved in the context of the Eurogroup have also been very important from the point of view of good financing conditions and from the point of view of the confidence of international investors and citizens in the commitment of all European partners to give a decisive response to the crisis. And I believe that it is very timely that from this Eurogroup and in the next two months we evaluate, review, how these instruments work and let’s see if it is necessary to address a modification as we are doing with the instruments that we adopt at the national level, which we will adapt adapting to the specific circumstances and needs of each moment “.
In this sense, the European Central Bank also announced last Thursday new measures from December and a readjustment of the instruments that it has put into operation in the face of COVID-19. “The recovery is losing momentum faster than expected due to the increase in COVID-19 cases,” said the president of the European Central Bank, Christine Lagarde, last week: “All data points to a worsening in November due to containment measures being taken against the pandemic We do not expect good data for November The ECB was there for the first wave [con su programa de compras de deudas y activos por valor de 1,35 billones] and it will be in the second wave. ”
“In the current environment of risks,” Lagarde said, “information, including the evolution of the pandemic, the outlook for vaccines and the evolution of exchange rates, will be carefully evaluated. The new round of macroeconomic projections prepared by experts from the Eurosystem in December will allow a comprehensive re-assessment of the economic outlook and balance of risks. Based on this assessment, the ECB will realign its instruments, as appropriate, to respond to the situation and ensure that financing conditions remain favorable to support economic recovery and counteracting the negative impact of the pandemic on inflation. ”
Regarding the recovery fund, whose regulation is in negotiation with the European Parliament, Calviño has been in favor of the proposal of the European Parliament, which prioritizes the conditionality of the fund to green, digital and social bets and not so much to the recommendations by country of the last two years of the European Commission. “The priority has to be in promoting economic growth and job creation. It is an instrument whose nature is essentially countercyclical and that is why we have to ensure that the investments and reforms necessary to have higher growth are financed and promoted. both in the short term and in the medium term, increasing our potential growth thanks to the structural reforms. I hope that there will be an agreement with the Council in the coming weeks: the main thing has to be to reach an agreement so that they can be put into action. The new instruments will be launched as of January 1, 2021 “.