Finance Watch

Covid economic crisis, a better way out: Let’s rethink the recovery

Visit our website "Rethink the Recovery"

The European Union’s €750 billion Covid recovery package presents a once-in-a-generation opportunity to transform our economy. Europe must seize this chance to build a bridge to a new economy that is sustainable, resilient, and guarantees better living standards for everyone. Join our call for European Finance Ministers to rethink the recovery.


Our five point plan

1. End support for unsustainable activities

Recovery financing must not be spent on supporting the fossil fuel industry and other unsustainable activities that have no place in the green economy of the future.

2. Guarantee living standards for all

Europe must ensure spending plans play an active role in guaranteeing a decent standard of living for everyone, through direct support for all who need it during the recovery and beyond.

3. Invest in the green transition

Europe must embark on a programme of ambitious spending to build the sustainable economy of the future, including green energy production, sustainable transport infrastructure, energy efficient buildings, environmentally friendly agriculture, and biodiversity protection.

4. No return to austerity

Europe must reform fiscal rules limiting borrowing when deficits reach greater than 3% and the debt-to-GDP ratio is higher than 60%. The return to fiscal austerity must be avoided.

5. Reform the European fiscal framework

The European fiscal framework must be reformed to prioritise long-term environmental and social resilience over short-term fiscal sustainability.

Our analyses of the existing recovery plans

Finance Watch has analysed the fiscal plans put in place by the French, German and Spanish governments. The plans aim to help repair the immediate economic and social damage brought about by the coronavirus pandemic as well as make their respective economies more sustainable and resilient to future shocks. The plans will be partially financed by the funds provided by the Next Generation EU Recovery and Resilience Facility (RRF) in accordance with the criteria defined by the RRF Regulation. The aggregated funding of the three fiscal plans amounts to around €302 billion.

Finance Watch assessed the proposed policy measures of France, Germany and Spain on their environmental and social sustainability as well as contribution to economic recovery vs resilience objectives. For this, the time horizon over which the measures are expected to have their effect (long-term vs short-term), and the alignment with the strategic objectives were taken into account. Such objectives include, among others, the reduction of greenhouse gas emissions, energy transition, digital transformation, social sustainability1 . Resilience measures were defined as long-term oriented and expected to have transformative economic effects rather than restore the pre-crisis economic situation, which is the main objective of recovery-oriented measures. Based on the analysis, the breakdown of the aggregated fiscal spending of €302 billion is as follows:

Extract of the overview of our results. Read more here

Read more in the overview of our results

See also our recovery plan analyses for the following countries:

To read more and support our call for financial ministers to rethink the recovey:

Visit the campaign website

Why and how to reform the fiscal framework?

Read our report:

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