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LMC 2020

The European Response to the Covid-19 Virus

Europe can be rebuilt after the crisis.

Margrethe Vestager

Executive Vice-president of the European Commission and Commissioner

The European Commission is putting together a plan for a European recovery fund, which should be measured not in billions of euros but in trillions. Photo: imago images / Steinach / Scanpix

Every evening for the last two months, at exactly 8.00 pm, people across Europe have stopped what they’re doing for a moment. They’ve come out onto their doorsteps and balconies and stood together, while social-distancing, to applaud the people who work so hard and so selflessly to keep us all safe.

It is a moment that symbolises the way that Europeans have come together in the face of Covid-19. They’ve called on deep reserves of resilience and solidarity to keep essential services running and to help out the vulnerable people in their communities. They have changed the way they live, to protect not just their own health but also that of others who they’ve never met.

A European Response to the Coronavirus Crisis

That is true of our local communities; it’s also true of Europe. The first instinct of Europe’s nations may have been to turn inwards, closing borders and hoarding supplies without much thought for coordination. But very quickly—with the help of the European Commission—the EU’s member states have begun to pull together. Because we know that we all depend on each other, and that the choices of any one of us affect us all.

Two decades ago, Lennart Meri spoke about the description that the Roman writer, Tacitus, gave of the people of Estonia. He recalled that, despite the huge distance from Italy to the Baltic coast, Estonians and Romans were part of the same world. Northern Europe provided not just amber and furs but also the seed grain on which the whole continent relied in tough years. And I don’t think he would be surprised that today—in one of the toughest times in our continent’s history—we are once again getting through by relying on each other.

In the past few weeks, the Commission has been working with member states to make hundreds of millions of euros available to fund research into new treatments, tests and vaccines. We have created a European stockpile of vital medical equipment—and launched joint procurement with member states of testing kits, masks and ventilators. We’ve set up a panel of independent epidemiologists and virologists from all over Europe so that governments can base decisions on reliable scientific advice.

The first instinct of Europe’s nations may have been to turn inwards, closing borders and hoarding supplies without much thought for coordination. But very quickly—with the help of the European Commission—the EU’s member states have begun to pull together.

We must also make sure that hostile acquisitions don’t siphon off Europe’s ability to meet its people’s needs. Europe is open to foreign investment—and this crisis doesn’t change that. But we should not let foreign takeovers of critical businesses deny Europeans access to vital products. So, on 25 March, we issued guidelines that call on EU member states to make sure that foreign direct investment doesn’t in particular undermine public health in Europe.

We have also been working to ensure that border closures don’t stop the flow of vital products like medicine and food. Europe’s supply chains cross many frontiers and the shelves of our pharmacies and food stores won’t stay full for very long if goods get stuck at borders. That’s why, on 23 March, the Commission issued guidance to member states on setting up “green lanes” at their borders so that goods can flow across them freely.

Of course, this is much more than a European crisis. The effects of this virus are global—and it will take global action to tackle them. This is why we’re cooperating with our international partners to fight Covid-19 and to keep international trade flowing. We are also bringing together resources from the EU institutions with money from member states and from financial institutions like the European Investment Bank and the European Bank for Reconstruction and Development to help countries around the world to prevent and contain the virus. Already, 400 million euros has been made available, from a total of 20 billion euros that our “Team Europe” plans to mobilise.

Tackling the Economic Impact of Covid-19

This is a global public-health crisis; it’s also an economic crisis. Whole sectors of the economy—aviation, tourism, live events—have almost completely shut down to keep the virus from spreading. And many workers are facing deep uncertainty about the future and where their next pay-check will come from.

So, to keep businesses intact and protect jobs, Europe needs an equally massive, coordinated response. And since March, the European Commission has been playing its part, alongside the EU’s member states, in leading that work.

Our Coronavirus Response Investment Initiative will let member states use eight billion euros of unspent EU funds, instead of paying the money back to the EU budget—which could bring in as much as 37 billion euros of investment. We have also proposed the activation of the escape clause in the Stability and Growth Pact, so governments can make full use of their public budgets to protect their economies without breaking the budget rules that guide spending in normal times. And the “SURE” initiative aims to make 100 billion euros available from the EU budget to support short-time work schemes, so companies can save money by cutting hours while staff still get paid.

The Livonian seed grain that Lennart Meri spoke about gave Europe a way to bounce back from tough times. No matter how bad the harvests might have been, that grain—kiln-dried, infection-free, long-lasting—always stored the promise of new growth within it. And these short-term work schemes help us to do the same today—to store away the potential, the know-how and the skills we will need to recover when the next growing season comes.

But for that to happen, we have to take the right decisions now. Above all, we have to rely on the EU’s single market, which gives our economy the strength and resilience we will need to bounce back from the crisis.

That’s the thinking behind the Temporary Framework of state aid rules, which the Commission put in place on 19 March. Those rules recognise that we will need large amounts of government support to help businesses survive this crisis and go on paying their staff. At the same time, they also reflect the importance of doing that in a way that doesn’t undermine the level playing field in Europe’s single market.

“The Temporary Framework has enabled EU governments to provide large amounts of vital liquidity support to European businesses – especially SMEs. We’ve already approved more than 150 state aid measures linked to COVID-19, in 27 European countries, making almost €2 trillion available to protect the economy – all in a coordinated way, with the same rules for everyone 1.”

Recovery From the Crisis

We’ve kept the seed grain dry and safe. Our next task is to make sure that it has the right conditions to start growing again.

On 15 April, the Commission set out recommendations on how to start easing the restrictions that have kept the outbreak under control. And so—although that process of easing will not happen overnight—the time has come to start looking further ahead, at a strong European recovery.

Coming back from a crisis as deep as the one we’re in will call for a strategic and coherent approach, and large commitments of public and private resources.

In the last few weeks, some industries have suffered much more than others. Some EU member states have been hit much harder than their neighbours, and not all countries have enough room in their budgets to invest in recovery. And, just as some organs in our bodies need special care to allow our whole physique to recover from illness, so a strong European recovery will call for particular attention to some parts of our economy. Because the alternative—an asymmetric recovery, in which some industries and some parts of Europe lag behind—will mean a weak recovery for us all.

This is why the Commission is putting together a plan for a European recovery fund—a fund that should be measured not in billions of euros, but in trillions.

That fund will need to be linked to the EU budget—Europe’s tested, trusted, transparent way of pooling resources—and direct that money where it can do most good.

We will also need to clear away the obstacles that could make it harder to recover than it ought to be. Europe’s businesses shouldn’t find that, at the same time they’re fighting to overcome the effects of Covid-19, they also have to battle with competitors that are stuffed with huge foreign state subsidies. So, in June this year, we will put forward ideas on how we can level the playing field caused by these subsidies in our single market.

And we will have to ensure that the investments we make will help Europe prepare for the green and digital future—because those twin transitions won’t wait while we deal with the recovery.

Before Covid-19, the European Green Deal was already Europe’s growth strategy. Now it’s also our recovery strategy. We need, more than ever, to get ahead of the game in the green technologies that will be the only route to sustainable success in the decades ahead.

And meanwhile, the way that many digital businesses have flourished through this crisis while their offline counterparts have struggled will only speed up the digital revolution—and make it even more important that we don’t fall behind.

The Digital World After Covid-19

In the past few weeks, as the coronavirus has forced us into physical isolation, digital services have stepped in to fill the gap. They have allowed us to go on working, studying, seeing friends and educating our children. New ideas have also emerged as the crisis has continued—partly thanks to hackathons like Hack the Crisis, which started in Estonia and has now had more than 100,000 participants in more than 40 countries.

In the coming months, even as strict lockdown measures are lifted, it’s unlikely that things will go back to exactly the way they were. And we need to make sure that Europe has the fast, secure digital connectivity that people need to get the most out of that potential—speeding up our work, for example, to bring ultra-fast broadband to homes, schools and hospitals throughout Europe and continue reaching for the targets set for 5G deployment.

We also need to make better use of data. Europe’s healthcare workers have done a remarkable job in this crisis. But that doesn’t change the fact that our health systems would have been better able to manage the spread of the virus if they had been able to access a secure and anonymous pool of health data from all across Europe. So, in line with the data strategy that the Commission published in February, we urgently need a European framework for collecting and sharing data in a way that respects people’s privacy, so we can build European data spaces, in particular for health.

And we need to be sure that the huge opportunities that digitisation has to offer are available to everyone. Without the right digital skills, fast internet connections and enough devices, some children are being left behind by the switch to digital education, while small local businesses may have to close down. And we need to tackle this issue urgently, so the digital revolution doesn’t deepen the digital divide.

In short, we still have a lot of work ahead of us. But when I stand on my terrace at 8.00 pm, and hear the applause for frontline workers echoing from the buildings all around, I have faith in what Europe can do.

But none of this potential will bear its full fruit unless we can trust digital technology. Today, Covid-19 dominates our media and the work of governments and businesses. But there will be an afterwards, when we will sorely regret it if we find that we have allowed fundamental rights, like our right to privacy, to slip away.

This is why we’re now coordinating work across Europe to specify how contact-tracing apps should be used. These apps could help to make it possible to lift lockdown measures without inviting a second, perhaps worse, peak of the disease. And the toolbox we have developed, together with EU member states, includes specifications to make sure those apps work well, that they are interoperable throughout Europe, and—crucially—that they respect our data and privacy.

It is also why we need to make sure we have the right rules in place to control the risks of new technologies like digital platforms and artificial intelligence. These can do a huge amount to make our lives better. They might even save lives, perhaps by helping us to spot the next pandemic before its full force hits. But as a society, we won’t be willing to accept that technology into our lives unless we’re sure we can trust it.

That is why one essential aim of the White Paper on AI that we published in February is to create an AI ecosystem of trust. It is why my Commission colleague, Věra Jourová, has been working closely with social media platforms during this crisis to fight disinformation. And for the future, we will need to make sure that we have a robust, transparent framework in place to deal with false and misleading information, especially when it comes through big online platforms.

This need for trust also explains why it is vital that we work on improving cybersecurity. Because the more connected we become, the more we are at risk of cyberattacks—and in fact the number of attacks has increased during this crisis. So we’ll focus on ensuring that Europe is prepared to meet the risk of serious attacks on our vital digital infrastructure.

And as digital platforms—search engines, online marketplaces, social media networks—come to play an increasingly important part in our lives, we are looking at whether the time has come to give those platforms new legal responsibilities to deal with dangerous products and harmful content. That way, consumers can have the same peace of mind when they go online as they do when they shop in physical stores, and businesses that follow the rules aren’t punished for their good behaviour by having to compete with rivals that aren’t so responsible.

Europe’s Potential

In short, we still have a lot of work ahead of us. But when I stand on my terrace at 8.00 pm and hear the applause for frontline workers echoing from the buildings all around, I have faith in what Europe can do. I know that our continent has rebuilt from worse crises, many times before. And I know that the spirit of togetherness we have shown in the face of this virus will give us the strength we need to emerge into a better future.

This article was published in the Lennart Meri Conference special edition May 2020 of ICDS Diplomaatia magazine.

  1. State of play on 11 May 2020

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