European Union finance ministers agreed on Monday to activate the “general escape clause” of the EU fiscal framework, allowing member states to spend as much as they want in the health and economy battle against the coronavirus.
They said that they expected a “severe economic downturn” this year due to the pandemic, therefore member-state are allowed to escape fiscal deficit and debt limit constraints.
It is the first time the EU uses the “general escape clause.”
In light of the COVID-19 crisis, ministers discussed the flexibility of the Stability and Growth Pact, in view of the communication presented by the European Commission on the economic aspects of the COVID-19 crisis on 20 March.
Ministers of finance issued a joint statement in which they agree with the assessment of the Commission that the conditions for the use of the general escape clause of the EU fiscal framework are fulfilled.
Economic impact of the COVID-19 crisis
Ministers exchanged views on the economic impact of the COVID-19 crisis and the various measures adopted both at national and European level to address it. The European Commission presented an assessment of the situation and its recent measures, including its Corona Response Investment Initiative or its temporary framework for state aid measures. The European Central Bank presented its Pandemic Emergency Purchase Programme announced on 18 March.
Finance ministers will continue to closely monitor the rapidly evolving situation. They restated their readiness to address the immediate effects of the coronavirus crisis in a coordinated and decisive way, while stressing the importance of helping the economy recovery once the coronavirus has receded
European Semester 2020
Ministers exchanged views on the impact of the COVID-19 on the European Semester 2020 and the way forward over the coming months.
Given the high degree of uncertainty surrounding any quantification of the economic effects of the pandemic, and the rapid evolution of fiscal measures to respond to the situation, member states are facing difficulties to deliver credible fiscal and economic projections. Ministers and the Commission agreed to adopt a flexible and pragmatic approach in carrying out the next steps of this year’s European Semester exercise.
well, thats a bit closer to what this whole panic was manufactured to sccomplish.
weve been suffering from a life threatening infection of bankers and politicians, and until we get rid of _that_ infection we and our whole civilization are in great peril.