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Regions must be at the heart of European economic policy  

Learning lessons from the austerity that followed the last crisis means changing the current EU economic governance rules and promoting public investment 

The much-needed involvement of cities and regions in shaping the European recovery after the COVID-19 crisis, as well as in shaping a new European economic governance system, were the main focus of the first meeting of the commission for Economic Policy (ECON) after the summer break.

Members of the ECON commission held an initial debate on the Recovery and Resilience Facility (RRF), the EUR 672.5 billion instrument (EUR 312.5 billion in grants and EUR 360 billion in loans) designed to support EU countries in carrying out reforms and investing in the EU's common priorities. The RRF is the biggest financial tool included in the EUR 750 billion recovery instrument Next Generation EU, known also as Recovery plan for Europe.

Christophe Rouillon (FR/PES), Mayor of Coulaines, is the rapporteur-general of the opinion entitled European recovery plan: Recovery and Resilience Facility and Technical Support Instrument, that will be adopted at the October 2020 plenary session. He stated that "The EUR 750 billion Recovery plan must both enable us to emerge from the COVID-19 crisis and redirect the European development model. As the institutional representatives of cities and regions, we regret that governance is too centralised at national level and that there is insufficient ambition in terms of sustainable development. In relation to the structural funds of cohesion policy, we must avoid duplication and robbing Peter to pay Paul. The Recovery fund, known as the "Recovery and Resilience Facility", can represent a real qualitative leap to boost European investment capacity, but it will not happen without involving Europe's cities and regions".

The fully remote meeting also focused on the texts drafted by two representatives of the Government of Wallonia. The ECON members voted on the draft opinion on the Economic governance review, undertaken by the Minister-President of Wallonia, Elio di Rupo (BE/PES), and held an exchange of views on the draft opinion on the Trade policy review, prepared by the Vice-President and minister for the Economy and Trade, Willy Borsus (BE/Renew Europe). The latter opinion is scheduled to be adopted by the ECON commission on 19 November.

Elio di Rupo (BE/PES), said: "The implementation of the suspension of the Stability and Growth Pact mechanisms during the COVID-19 pandemic enables states and local authorities to respond to the needs of citizens and businesses. However, the rules of economic governance need to be reviewed in depth in order to live up to the ambitions of a Europe that responds to the aspirations of its citizens and to relocate essential strategic companies (health, food, etc.). I expect the European Commission to propose an ambitious text for a resilient, digital and sustainable Europe".

The rapporteur for the European Parliament on the Economic Governance Review, Margarida Marques (PT/PSE), took part in the debate. Due to COVID-19 measures, the fully remote vote on the text will be finalised on Thursday 1 October. The adoption of the opinion by the CoR's plenary is scheduled for 9-10 December 2020.

On 28 July, Mr Di Rupo and Mr Rouillon had a virtual meeting with EU Commissioner for Economy, Paolo Gentiloni. They both stressed the importance of putting local and regional communities at the heart of every national recovery plan. 

Previously, on 2 July, the President of the CoR, Apostolos Tzitzikostas, had met Commissioner Gentiloni to discuss how to best involve regions and cities in steering Next Generation EU.

Commissioner Gentiloni will attend the October CoR's plenary session for a debate on resilience and recovery. 

Members also had an exchange of views with Fabian Zuleeg, chief executive of the independent think tank European Policy Centre (EPC), on the developments in future EU-UK economic and trade relations, as well as on the Brexit adjustment reserve. The new special instrument was designed to counter unforeseen and adverse consequences in Member States and sectors that are worst affected by the withdrawal of the United Kingdom from the EU. According to the conclusions of the 17-21 July 2020 special European Council, the Brexit adjustment reserve will be endowed with a EUR 5 billion budget for 2021-2027.

The ECON commission appointed Isolde Ries (DE/PES), First Vice-President of the Saarland Regional Parliament, to serve as its rapporteur on the Action Plan on critical raw materials. The Action Plan was presented by the European Commission on 3 September.

The effects of COVID-19 in the EU's regions and the challenges faced by local and regional authorities as a result will be the subject of the first Annual Regional and Local Barometer, which the President of the European Committee of the Regions (CoR) – Apostolos Tzitzikostas, Governor of Central Macedonia – will present at a speech at the CoR's plenary session on 12 October. The Barometer draws on specially-commissioned studies as well as other research to provide a detailed assessment of the crisis and of some of the major political and policy issues it has raised.

Meeting documents

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Matteo Miglietta
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