ESM, SURE, Recovery Plan and Eurobonds: Too Little Too Late?

Speakers:

Sir Michael Leigh, Academic Director, Master of Arts in European Public Policy Senior Adjunct Professor of European and Eurasian Studies
Filippo Taddei, Associate Professor of the Practice of International Economics; Director of the Bologna Institute for Policy Research; Academic Director, Master of Arts in Global Risk
Moderated by Erik Jones, Director of European and Eurasian Studies and Professor of European Studies and International Political Economy

The Bologna Institute for Policy Research (BIPR) hosted an online seminar on Europe’s response to the coronavirus. The discussion began with Jones asking whether the mixture of measures agreed upon in the Eurogroup meeting on April 9 were too little, too late.

Taddei explained that the European economy faces a two-tier shock of supply and demand. As a two-tier response, he presented an overview of monetary and fiscal measures on national and European levels, including the European Central Bank’s Asset Purchase Programme (APP), the Pandemic Emergency Purchase Programme (PEPP), EU Coronavirus Response Investment and a European unemployment insurance (SURE). Taddei proposed two criteria to consider with regards to fiscal response: cash flow and the degree of mutilation.

The political challenges facing the EU where then discussed by Leigh, who argued that the European Commission did move quickly despite public health being largely a national responsibility of EU member states. Leigh further stressed that the exit from the crisis poses long-term challenges to the EU, which call for the mobilization of all of its capabilities and legal powers. In the multiannual financial framework (MFF) for 2021-2027, for example, he argued the Union’s main challenge would be to reconcile three sets of priorities: long-standing ones, such as agriculture, newer and more urgent needs, such as the digital single market and the environment, as well as priorities created by the coronavirus crisis. In their response to the crisis, Leigh highlighted the need of EU member states to learn from each other, and also to draw from past crises, such as the 1978 Davignon Plan and the Euro Crisis.