Summer Truce In EU Before The Big Battles Of Autumn

Summer Truce In EU Before The Big Battles Of Autumn

Summer was expected to be the turning point in the exit from this pandemic. With the arrival of the first recovery funds to the capitals and the vaccination campaign gaining speed in the EU, to the point of surpassing the US or the UK, Brussels was looking optimistically at the second half of the year, and more. there. So much so, that even with the Delta variant already expanding across the continent, the Economy Commissioner, Paolo Gentiloni, did not expect more restrictions in early July.

But as with the British variant, Delta has become a powerful reminder that the fight against covid-19 will be longer and tougher than we thought , even with the vaccine in our hands. The virus will continue to be the main concern for community institutions and capitals, although the rest of the year will bring intense legislative activity and tough political battles. “It will be a very loaded rentrée ” , sums up a senior community official.

The approval of new treatments against covid-19, the possible lifting of restrictions on connections with third countries or the discussion about the measures that countries adopt to encourage vaccination among their citizens will be one of the faces in the fight to try to return to normal. The other will be the filming of the recovery fund of 800,000 million euros.

So far, 16 Member States have already received approval for their recovery plans, including Spain. At the turn of the summer, the sending of the first blocks of milestones and objectives that governments will have to overcome in order to gradually access the funds will begin.

Spain will in all probability be the first partner to request the first payment of 10 billion euros, for having already fulfilled the commitments of the first term with a series of reforms adopted since February 2020.

They will be added to the 9,000 million euros that it will receive in pre-financing at the beginning of August. And although no problems are expected, community sources point out that the European Commission will take its time for the evaluation, since the analysis of the fulfillment of the first milestones and objectives will set a precedent for the rest of the countries.

More problems will come with the Hungarian and Polish plans . The Commission has postponed the approval of its plans because both countries have to strengthen their anti-corruption mechanisms and the independence of their judges.

The pulse that the EU maintains with these two partners for the plans is the last battle front in the challenge that both countries maintain to the principles and values ​​of the bloc, and that has been increasing in recent months. In the case of Poland for questioning the primacy of community law, and in the case of Hungary for the approval of the law that stigmatizes the LGTBIQ community.

The diplomatic sources consulted do not believe that the approval of the plans will become the tool to settle accounts at this time. But with a tension that does not stop growing, no one dares to venture how the confrontation will end.

The waters will not be calmer on the economic front, once the Commission relaunches the review of the Stability and Growth Pact in autumn. There is no unanimity even within the Community Executive. While the economic vice president, Valdis Dombrovskis, defends modifications that generate consensus, such as the simplification of the rules that control the deficit and debt, Gentiloni openly advocates taboo proposals in the North, such as the inclusion of clauses that favor productive investment.

A diplomat from a member state of Los Frugales rejects this option outright, although they are open to considering other ideas long demanded by partners such as Italy and Spain, such as the elimination of unobservable indicators such as the output gap when calculating the fiscal effort that countries have to make, or agree on smoother trajectories to reduce debt after the pandemic.

The second half of the year will also coincide with intense legislative activity . Member States and the European Parliament will be very busy preparing their positions on the ‘green’ mega-package presented by the Commission in July to transform the energy, transport or fuel tax sector to achieve a 55% reduction in emissions for 2030.

In addition, the Commission has a substantial list of proposals scheduled for the autumn and winter. Among them, the revision of the capital requirements norms and the norms that regulate insurers (Solvency II), both in September; the review of the Competition policy, or the review of the frameworks for investment funds and the rules for managers, both for October.

This frenzied activity will coincide with the departure of the most veteran of European leaders and guarantor of stability in the toughest moments of the EU. Angela Merkel will leave the German Chancellery after 16 years in power following the September elections . It remains to be seen the direction that the new Berlin coalition will set, in a world that will continue to test the unity of action of Europeans.

The capitals will continue to maintain the line against the United Kingdom , which will not only continue to cause problems with the Northern Irish border but also in the negotiations on the future relationship with Gibraltar, which will be led by the Commission but Spain will follow closely.

With Joe Biden in the White House, the relationship with the US will not suffer shocks, but it still has important folds to iron, such as tariffs on steel and aluminum. Although the big headache will continue to be China. Brussels plans to review its 2019 strategy in the autumn, in which it defined Beijing as a “systemic rival.”

Along with these great poles, European diplomacy will continue to jump from crisis to crisis , balancing interests and values, passing through Belarus, Turkey or Venezuela.

Despite the intensity and stack of challenges, Europe will come to the end of the year knowing not only that the bloc is resistant to the toughest onslaught, but learning the lessons. If a decade ago the euro crisis, fueled by austerity, pushed the EU back into recession in 2012, dragging Spain to ask for a bailout, this time the member states put together an unprecedented recovery fund against the virus, and They face a recovery that, albeit with ups and downs, could bring the greatest simultaneous transformation of their economies in decades.

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