The European Union has been under a state for emergency for some days now. Meanwhile, the Covid-19 pandemic has reached the entire EU. Even if it is not yet possible to fully evaluate the extent of this crisis, one thing is clear: the European Union is facing an unprecedented challenge.
After in the beginning most countries reacted rather hesitantly to the spread of the virus, in recent days many countries have imposed restrictions that Europe has not seen since the end of the Second World War. In order to slow down the rapid spread of the virus and to prevent health systems from collapsing, many countries for example massively restricted the freedom of assembly and the freedom of movement. It is not yet possible to assess the duration and consequences of this health crisis, but it is already becoming apparent that if will bring serious cuts in all areas of life for the population of Europe.
Closure of external borders
In view of the continuing spread of the pandemic, Commission President Ursula von der Leyen announced on 17th March 2020 that Europe will close its external borders to all non-essential travel. This shall delay the spread of the virus in Europe, but also globally. This is also linked to the hope that the member states will no longer follow the current trend of closing borders at national level. Von der Leyen: "We know that too many people are stranded within the European Union and have a problem to go back home." However, it is still unclear whether the closure of the EU’s external borders will really lead to an opening the borders between Member States.
The spread of the virus and increasing number of border closures have also led to a significant drop in demand for air travel. But even without passengers, aircraft continued to fly to airports. This phenomenon is due to the “use-it-or-lose-it” rule under which airlines without using at least 80% of the current take-off and landing rights lose the right to use them the following year. Not only in view of the Covid-19 crisis, but also in order to avoid empty flights, it seems to be sensible to apply an exception and thereby the suspension of the original regulation. This has been in force from 1st March to 30th June, with the option of extending it, if demand remains low.
Fighting the virus
One of the big questions regarding Corona is when a vaccine against the virus will be available. Currently, intensive research is being carried out in about 35 companies and research institutes worldwide to develop a vaccine against Covid-19. As early as April, it will be possible to test the vaccine on humans. In order to have available a successful vaccine as soon as possible, the European Union too has made research funds available. For example, the Commission financial support of up to 80 million Euro offered CureVac, a German vaccine developer.
Apart from that, it shall be ensured that the supply with protective equipment and medication is guaranteed within the EU. This was presented as a further target of the Commission measures. Many of the presented measures focus on the immense socio-economic consequences, which are expected in light of the Covid-19 crisis.
Disastrous consequences for Europe’s economy
The current crisis will hit the European economy particularly hard. In most countries, all shops, which are not part of the critical infrastructure (food stores, pharmacies, etc.) are closed. In other sectors, such as tourism or gastronomy, but also in the arts and culture, all revenues are falling away. Stock markets worldwide are in freefall; last week, traders even talked of a “Black Monday” and the oil price plummeted by around 30 %. The European Commission assumes that the current crisis will plunge Europe’s economy into recession.
On 16th March, the European Commission provided the Member States with a “draft proposal for a State aid Temporary Framework to support the economy in the context of the Covid-19 outbreak”. In a declaration, Executive Vice President Margrethe Vestager demanded a rapid and coordinated approach and formulated two goals: First, that businesses have the liquidity to keep operating. Second, that support for businesses in one Member State does not undermine the unity that Europe needs. The Commission proposes four concrete measures: direct grants or tax advantages up to € 500,000 to a company subsidised State guarantees on bank loans, public and private loans with subsidised interest rates as well as the recognition of the important role of the banking sector to deal with the economic effects of the crisis.
Health policy: Commission focusses on functioning internal market
The Covid 19 crisis does not undermine the regulated competences between the Member States and the EU either - health policy remains primarily a matter of the Member States; however, the Union still has supplementary competences. It is to be expected that in times like these, this might be of particular significance. On 15th March, Commission President Ursula von der Leyen spoke out in favour of maintaining the smooth movement of goods in the internal market. In particular, the movement of medical products, such as protective equipment for hospital staff, should not be affected. Member States should come to each other's aid, and exports outside the EU should only be permitted by special authorisation and are thus de facto suspended. Even if the transport of goods has been explicitly excluded from the already mentioned border closures within the EU, kilometre long tailbacks, for example at the Polish-German border show that the Commission must continue to find a way towards better coordination among Member States.
Protection for truck drivers
Incidentally, the work of lorry drivers is also indispensable for a functioning internal market - especially for the supply of food to the population. In order to maintain supply chains, several Member States have suggested or implemented a relaxation of driving times and rest periods as well as the cabotage regulation. The European Transport Workers’ Federation warns that the wellbeing of drivers had to be especially protected and that it was necessary to find an answer at European level. Due to the changed opening hours and closures of motorway services respectively, it had to be urgently ensured that drivers had shower and toilet possibilities as well as shopping opportunities to look after themselves.
European institutions in crisis modus
The crisis also has a far-reaching effect on the activities of the European institutions. Besides Parliament and the Council, the Commission is also in crisis mode, at least until the end of April. The fact that it is reducing its work to an absolute minimum is also evident from the updated agenda for the forthcoming college meetings. The situation also has consequences for the negotiations regarding further trade agreements. The talks between the EU and Great Britain have been suspended for the time being. Nevertheless, both sides want to continue the process and have exchanged their respective drafts for a possible legal text on Wednesday, 18th March. Apart from that, Trade Commissioner Phil Hogan cancelled his trip to the USA and Canada, where, apart from the reformation of the WTO the negotiations on the planned “Mini Free Trade Agreement” with the USA should have been continued. The Conference on the Future of Europe, which was to take place on 9th May, will probably have to be cancelled.
Protection against unemployment and loss of income
The European Trade Union Confederation (ETUC) welcomes the promise of the Commission to protect workers against unemployment and loss of income. Here, the Commission must ensure that the support actually reaches the employees and that the self-employed and precarious workers also benefit from it. ETUC regards the relaxation of fiscal policy rules and State aid as equally essential as setting up an EU Fund, which protects workers and companies against the most serious consequences of this crisis.
In Austria, the Chamber of Labour (AK) together with the Austrian Trade Union Federation (ÖGB) has published a website for employees, on which the most frequent labour law questions in connection with the current situation are answered in several languages.