How do we handle the economic crisis

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How do we handle the economic crisis?

• European and National Economic Recovery Plans
• CEBRE, 17 June 2009
• Giovanni Campi, Senior Policy Advisor,
  EUROCHAMBRES

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(No Transcript)
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1. European Chambers perspective

• The European CCIs evaluation of their NERPs is
  generally satisfactory/good (2.5 on a scale from
  1 to 5)
• The majority of CCIs broadly supports the
  measures contained in their NERPs, which seem to
  follow the EERP guidelines
• Taking the 10 Actions for Recovery of the EERP
  as a benchmark, all MS have announced actions in
  those fields
• employment
• demand for labour
• access to finance for businesses
• investments in infrastructure

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1. European Chambers perspective (ii)

• European CCIs noticed that actions at national
  level are much less intense in the following
  fields
• energy efficiency
• green products
• clean technologies
• investments in RD, innovation and education
• Over half of respondent CCIs noticed that
  measures for green technologies/ products have
  not been taken in their countries
• Many CCIs asked for measures in the following
  fields
• More guarantee schemes for SMEs
• Measures to facilitate access to credit
  (particularly CEE)
• More resources for training, education and
  flexicurity
• Actions to help with late payments

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2. What about the G20 countries?

• On average, the magnitude of the NERPs of the G20
  countries is between 1 and 2 of GDP
• Around 0.5 or less Argentina, Australia, Brazil
• Over 2 China and Canada
• The majority of G20 CCIs broadly agrees with the
  measures included in their NERPs
• G20 CCIs deplore general one-off rebates or
  actions which do not have at least a short or
  medium-term perspective (e.g. tax reductions in
  several countries)

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2. What about the G20 countries? (ii)

• Number of measures included in the G20 NERPs (in
  this order)
• Investment in infrastructure
• Access to finance measures
• Employment measures
• Actions to reduce administrative burdens
• Increased investment in RD
• Demand for labour
• Clean technologies
• ? In some of the G20 emerging economies the NERPs
  are way less developed (both in magnitude and
  measures included) compared to most of the
  developed economies. But, the focus is very
  similar.

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3. Policy elements

• Measures to sustain short-term aggregate demand
  and employment BUT not enough competitiveness-orie
  nted/medium-term measures
• NERPs fail to implement structural actions
  related to taxation, social charges and the
  public administration which would prove
  instrumental to increase productivity and
  economic resilience
• Not much smart/green growth measures
• Size of the EERP/NERPs does not matter too much,
  the type of measures included and their
  implementation do!

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3. Policy elements (ii)

• Stabilization of the financial system and
  provision of affordable credit to the real
  economy not yet attained (ECB bank lending
  survey, ECB financial stability report etc)
• No or only partial interconnection with the SBA
  measures
• Lack of coordination with legislative ad policy
  actions which are not directly part of the
  recovery packages but which benefit the Internal
  Market
• Larger divergences in EU countries economic
  performance in the future

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4. Priorities

• Today
• Stabilization of the financial system ? Access to
  finance
• Late payments
• Safeguard and deepen the Internal Market
• Revise plans with priorities more in line with
  structural improvements and implementation
• Tomorrow
• Public finances and SGP
• Reduce skills mismatch and enhance labour
  mobility
• Stronger fiscal coordination in the euro-area
• ? How to allocate EU resources ? EU budget review
  (but, as for now, thats another story)