To help the European economy emerge from the economic recession caused by the Covid-19 pandemic, European Union (EU) leaders agreed in July on a € 1.82 trillion economic recovery package. It consists of a seven-year budget and a special new fund called Next Generation EU with € 750 million. But now its progress is threatened by the veto imposed by Hungary and Poland yesterday.
Both countries are dissatisfied with the rest of the idea of linking the allocation of European money to the rule of law. In an interview with LTV, the President of the European Commission (EC) Urzula von der Leiena explained the upcoming support measures.
Ilze Nagla: President of the Commission, thank you for the conversation with Latvian Television! Let me start with the issue of economic recovery. Europe is now experiencing its worst economic downturn since World War II, and the EU is embarking on a huge economic recovery program. But it takes much more time than planned. When will Latvia be able to wait for the first money to arrive? Isn’t there a risk that for some companies it might come a little too late?
Urzula fon of the Leiena: First of all, it is really good news for Latvia that in the big [ekonomikas] The next generation recovery package “Next Generation EU” provides 4 billion euros for Latvia. We must now conclude the negotiations, indeed, in the European Parliament and the Council, and then the national ratifications. But I think at the end of spring we can start working on this program. But I already have good news for Latvia, because we are already starting the so-called “SURE” program [Atbalsts bezdarba risku mazināšanai ārkārtas situācijā], which means that from tomorrow (the interview took place on November 16 – ed.) 120 million euros will be available to Latvia. The SURE program is aimed at workers and healthy companies who have been hit hard by the crisis. The principle is to tell companies – do not lay off your employees, keep them in the company, because thus you retain skills and knowledge in the company.
We will subsidize wages if there is not enough work.
But if you have employees, then when the economy grows again and orders come, you can handle those orders because you will have the remaining capacity.
But this 120 million euros will be a loan. How confident can Member States be that we will be able to repay the debt without too much effort in the future?
This is loans on very, very good terms. And that is the strength of the European Union: when the European Commission goes to the capital market to raise money, we have the support of 27 Member States. So this is a good loan. I think that in these difficult times, it is right to invest a lot in the economy so that we can overcome this difficult time of pandemic until the economy comes to life again, and then – we all know – the single market will be a huge force.
Interview in English:
Observing how different EU governments help their business and economy, do you think that the Latvian government should do more? Should it be more generous in providing direct support to Latvian citizens and companies?
These are local decisions, but as the European Commission, we are convinced that we must both support and prepare for the future together. Therefore, the Next Generation EU program will make a special contribution, for example, to digitization and the European Green Course. So let us not only recover, which is important, but also build a stronger and more resilient economy – cleaner, healthier. May we be better prepared for the future.
In December, we are likely to see some of the current restrictions lifted in most EU Member States. But it seems that 1. however, there will be no vaccine in January. How confident are you that there will be no third pandemic in Europe?
In recent days, we have had good news about vaccines, for example, with BioNTech. Tomorrow (interview on 16 November – ed.) The Commission will sign a fifth contract with a pharmaceutical company for vaccines. So, this is good news. Of course, you are right – it will take some time to make sure that potential vaccines are safe and effective. Until they are produced and people are vaccinated – and until then we have to be very disciplined, we have to stick to safety measures – wearing a mask, distancing ourselves – we all know that. But,
if we are patient, if we are very disciplined, then we see a light at the end of the tunnel – they are vaccines.
We now have a good portfolio for Europeans, and I am sure that sooner or later we will have a solution to this pandemic.
Health is not one of the EU’s common policies – it is the responsibility of each Member State. Do you think this needs to change? Will the Member States be prepared to hand over some of their powers to Brussels?
We have already seen that the Member States – and rightly so – have asked the European Commission to coordinate more, and we have done so. And since then, we have really had a common approach, both on the issue of tests and on risk areas and such important green belts when crossing borders. The European Union coordinated many areas, such as vaccine agreements, to make sure that Latvia, like all 26 other member states, has access to the vaccine when it is ready – so that there is a level playing field, proportionality and simultaneous access. It is very important.
President of the Commission, I would like to end by asking about strategic autonomy, which has been a concept of fashion in recent months. Some say it will be a “European fortress”. Where and how do you draw the border – how does Europe gain more autonomy without becoming a fortress?
On the one hand, most member states are members of a strong alliance, NATO. And within this strong alliance, Member States must take responsibility for what they do. I know that Europe’s position within NATO has strengthened in recent years. But we need to look more broadly. For example, autonomy also means independence in supply chains. We have seen that during a pandemic, if we are too dependent on a source of supply, then suddenly we have a big problem in a severe crisis. That is why it is important to diversify our supply chains. You can go through different topics and see how the word “autonomy” is understood. This is important: we are an open economy, and we, as Europeans, are convinced that multilateralism – working together on common rules – is the best way forward for us, for the planet and for the world. But it is also important for us to have some flexibility in the event of a crisis. As in this pandemic, we have learned our lessons and we are moving forward.
President of the Commission, thank you very much for the conversation on Latvian Television!
Thanks!
–
