By Jan Strupczewski
BRUSSELS (Reuters) – The European Union has responded to the coronavirus, seen by German Chancellor Angela Merkel as the biggest challenge since World War Two, with a wide range of measures to limit the spread of the disease and the resulting economic damage.
– EU leaders closed Europe’s external borders for 30 days with an option to extend that.
– EU countries have introduced national lockdowns, closing bars, restaurants and cinemas, and calling off events that bring together large numbers of people.
– To keep goods flowing in the internal EU market of 450 million people, the Commission has proposed fast lanes for lorries carrying merchandise across borders.
– The European Central Bank launched a 750 billion euro emergency bond purchase scheme, taking its total bond buying to a massive 1.1 trillion euros, arguably the biggest such program globally. The ECB included in it even countries like Greece, whose low credit rating would normally exclude it from such schemes.
– The ECB also provided banks with extra liquidity and eased capital requirements so that they can handle bigger problems with repayments of loans from borrowers.
– Euro zone finance ministers have so far agreed on a 1% of GDP, or 120 billion euro, fiscal stimulus and announced measures worth 10% of GDP, or 1.2 trillion euros, to keep companies from going bankrupt and laying off workers. Governments have promised more will follow if needed.
– The Commission and EU finance ministers decided that national governments can spend as much as they want on fighting the epidemic, without the risk of falling foul of EU budget rules which limits government borrowing to safeguard the value of the common currency – the euro.
– The European Investment Bank, the massive government-owned investment arm of the bloc, offered nearly 40 billion euros in additional financing to small- and medium-sized companies to help them stay in business.
– Euro zone countries are considering ways to put their bailout fund with its unused 410 billion euro capacity to work to support the economy.
MEDICAL SUPPLIES AND VACCINES
– The European Commission decided to set up a stockpile of face masks, intensive care equipment and other essential medical gear to tackle shortages in Europe. It made exports of protective personal equipment outside the EU subject to national government decisions.
– The Commission mobilized 140 million euros of public and private funding for research on vaccines, diagnosis and treatment. It also pledged 80 million euros in financial support to a German firm CureVac after it emerged that Washington was trying to persuade it to move its research into a vaccine against the coronavirus to the United States and give the U.S. exclusive access to the results.
REPATRIATION OF CITIZENS
The EU is paying 75% of the costs of flying back EU nationals from around the globe.
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