Exceptional situation calls for exceptional measures

On 16 July, President Charles Michel sent out the second issue of his newsletter, in which he informs citizens about the activities of the European Council.

"This time I’d like to talk to you about the major economic recovery and support plan we are currently working on with European leaders. And to share some thoughts on what our more long-term horizon should be. "

President Charles Michel, 16 July 2020

The President admitted that the crisis brought about by this pandemic, with all of its economic and social consequences, has been the most severe the EU has had to face since the Second World War. "To address this situation, which is of an exceptional nature and size, we are working on a plan of an exceptional nature and size: a plan to the sum of EUR 1 800 billion*," he said. He also stressed that this investment is far greater than the economic support measures adopted by the United States and China.

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A word from the President, 16 July 2020

Hello, 

 

This time I’d like to talk to you about the major economic recovery and support plan we are currently working on with European leaders. And to share some thoughts on what our more long-term horizon should be.  

 

The crisis brought about by this pandemic, with all of its economic and social consequences, is the most severe we have had to face since the Second World War. To address this situation, which is of an exceptional nature and size, we are working on a plan of an exceptional nature and size: a plan to the sum of EUR 1 800 billion*.

 

An unprecedented recovery plan 

 

Yes, I really mean one thousand eight hundred billion euro, a large part of which will be released in the next three years! Added to the approximately EUR 540 billion already made available in April to support the finances of countries and businesses affected by the crisis, this represents the equivalent of 17 % of the wealth produced in one year in the European Union. This investment is far greater than the economic support measures adopted by the United States and China. With this step, action by European leaders in 2020 has been much swifter and more forceful than during the financial crisis in 2008-2010.  

 

The negotiations to reach an agreement between the 27 European leaders on the European recovery plan are not easy. Does EUR 1 800 billion* seem like a lot of money to you? Believe me, it does to the European heads of state or government too.  

 

Making up the gaps 

 

But it is worth it. The raison d'être of the European Union’s financial resources is, first and foremost, to support the recovery and help our countries and our regions make up the gaps in development between them. COVID-19 has hit some parts of Europe and the more financially vulnerable countries harder than others, and they will have more trouble recovering. If we don’t repair the damage as soon as we can, it is not just for the regions directly affected that the consequences would be dramatic. They would also be damaging for Europe as a whole. After all, Europe’s prosperity is drawn from its huge unified market, so if one of us is weakened, it weakens us all.  

 

That is why I am convinced that the exceptional funds that we are going to mobilise to counter the effects of the COVID-19 crisis must primarily be used to support reforms and investments that are geared to the future, that will make each of our member states stronger.  

 

Stronger, and more resilient – that is what we will become by embracing the two major projects to transform our economies and our societies. The green transition, designed to safeguard our planet’s future, will create fantastic job opportunities. And the digital revolution will generate an inexhaustible supply of new opportunities, for our lives and our economies alike. 

 

Quantitative growth is not enough 

 

There is also a fundamental lesson to be drawn from this crisis. While consolidating public finances has been at the top of our agenda in recent years, this crisis has brought home what’s most important: our health and our individual and collective well-being, which has been directly affected by the virus. It is this well-being, embodied by a compassionate and caring society, which I believe should be Europe’s new horizon. 

 

And, when we view things from that perspective, we should think about the fact that well-being cannot be measured by one indicator alone, namely quantitative growth. For decades now, we have been measuring progress by one single parameter: the evolution of gross domestic product. It is a useful indicator. But it is not enough. Because it does not measure the actual feeling that you have about whether your life, as a European citizen, has improved in comparison to the previous year or years. In this project of transformation which we are setting in motion at European Union level, we must have a democratic debate on the goals we set ourselves as a society, the criteria for which cannot be solely quantitative. They should also include essential parameters such as the quality of our environment and of education, access to quality healthcare and to the digital world, without discrimination, reducing inequalities, respect for fundamental values...  

 

And these are issues which encompass, and go beyond, purely financial matters. They should, I am convinced, be at the heart of the conference on the future of Europe which will, I hope, soon involve citizens from right across the Union.  

 

 

Charles Michel

 

 

* Precisely: 1.074,3 billion for the multiannual budget, and 750 billion for the recovery fund.