European, French and German flags
18 May 2020

France and Germany united for the sustainable recovery of the European Union

The President of the Republic and the German Chancellor have defined a series of concrete actions designed to ensure the European Union's sustainable recovery and that it comes out of the health crisis stronger than ever.

Emmanuel Macron and Angela Merkel have come forward with a range of proposals in order to achieve this goal.

Independence with regard to health

This requires implementation of a full-fledged health strategy based on:
  • research and development in the field of vaccines and treatments, along with international coordination and funding (ACT-A Initiative). The short-term goal is to develop and manufacture a vaccine against coronavirus in the European Union (EU) and guarantee global access to it;
  • common strategic stocks of pharmaceutical and medical products, and production capacities for such products in the EU;
  • common public contracts for future vaccines and treatments so as to be able to speak to the pharmaceutical industry with a single voice and guarantee more effective European and global access;
  • a task force responsible for health at the European Centre for Disease Prevention and Control;
  • definition of common European standards on interoperability of health data (e.g. a harmonised methodology enabling availability of comparable data).

A European recovery for solidarity and growth

In order to support a sustainable economic recovery in the EU, a stimulus fund is proposed in the context of the next Multiannual Financial Framework (MFF), as well as an increase in the MFF concentrated on its first few years.

The European Commission would be authorised to finance the recovery on a legal basis in full compliance with the European Treaty, the EU's Budgetary Framework and the rights of national parliaments:
  • the stimulus fund will be provided with 500 billion euros in EU budget expenditures for the most affected sectors and regions, on the basis of the EU's budget programmes and in compliance with European priorities;
  • financing by the stimulus fund will target problems connected with the health crisis and its repercussions. It will provide exceptional complements, integrated into decisions bearing on own resources, with clearly specified volumes and expiry dates, and be connected with a binding reimbursement plan following the next MFF on the EU's budget;
  • rapid overall agreement on the MFF and stimulus fund will be necessary if the EU is to meet the challenges ahead. Negotiations will draw on progress made up until February;
  • such support for the recovery complements national and Eurogroup measures, with each State implementing sound economic policies and ambitious reform programmes;
  • improvement of the European framework in order to achieve a fair taxation system in the European Union remains a priority, in particular through introduction of effective minimum taxation and fair taxation of the digital economy in the Union, ideally based on the productive outcome of work carried out by the OECD, as well as implementation of a common corporate tax base.

Accelerated ecological and digital transitions

The European Green Deal constitutes the EU's strategy for growth as well as the roadmap for carbon neutrality by 2050. It is a question now of accelerating the digital transition, turning the trends that have emerged during the crisis into sustainable digital progress and independence, with:
  • an increase in the EU's 2030 emission reduction goals, coordinated in order to avoid “carbon leakage”. The Commission's proposal regarding a mechanism for adjustment of carbon emissions at borders will enable existing instruments to be complemented in compliance with the WTO's rules. Rules on State aid will have to be revised in the light of a more ambitious climate policy and carbon leakage risks;
  • introduction of a minimum carbon price in the EU's Emissions Trading Scheme (ETS) and introduction of a European ETS for all sectors;
  • drafting of a roadmap for recovery that respects the environment, including, where necessary, targets and/or conditionalities with regard to climate and environment;
  • acceleration of the digital transformation, in particular through deployment of 5G, work on obtainment of robust, reliable infrastructures and cybersecurity technologies, and fair regulation of digital platforms in the EU.

Fresh momentum for the single market

The EU's economic and industrial resilience and independence require a robust single market with:
  • diversification of value chains, with a trade agenda incorporating heath products, reinforcement of [third country] anti-subsidy mechanisms, genuine reciprocity for public contracts with third countries and reinforced control of (non-EU) foreign investments in strategic sectors (health, medicines, biotechnologies, etc.), while encouraging investments (re)located in the EU;
  • adaptation of rules governing State aid and of rules on competition, along with implementation of major projects of common European interest (enabling European aid);
  • a new roadmap for a fully integrated market in priority fields (digital technology, energy and financial markets in particular);
  • proper operation of the Schengen area, with increased coordination between Member States in times of crisis and common external borders;
  • social convergence in order to arrive at a European minimum wage adapted to national situations.

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