“The Brussels Diary with Yana Toom”: What Does EU Do?


Everybody is talking about how Europe is not responding. This is not true. Europe simply doesn’t call attention to what it is doing at every step.

There seems to exist the view that Russia and China are helping Italy but the EU is not. However, the facts are the following: Ursula von der Leyen, President of the European Commission, came to an agreement with China’s Prime Minister and a plane with two million masks and fifty thousand test kits arrived in Italy this past Monday. Two months ago, the EU sent 56 tons of medical equipment to China and now China is helping the EU. I have not even mentioned that the European Central Bank is buying out Italy’s debt to avoid the country’s complete collapse.

What would you call it other than European solidarity? Alas, in the news you do not hear anything about it because the EU does not try to market itself. It simply does its WORK. The European Commission is providing credit of 8 billion euros to support small and medium sized businesses. It temporarily cancelled duties and VAT on the import of medical products. This list of measures goes on.

An important initiative that will affect many is a pan-European instrument for temporary Support to mitigate Unemployment Risks in an Emergency (SURE). These measures are already working in Germany and Italy. The objective is to encourage employers not to lay off anyone during the crisis period but rather to temporarily cut costs and use short-time work schemes. The employees, though, will not receive half of their salary but much more, and the difference will be covered by the state. In our case, the European Union takes employees under its wing. In 2009, this measure was successfully employed in Germany when the minister of labour was none other than Ursula von der Leyen.

I remind you that back then Estonia, in contrast, simplified the process of layoff. This approach had an adverse effect for all: the number of employees decreased by 15% (that is one hundred thousand people!) in two years and recovered after only nine years. Income dropped, demand dropped. We had to clean up the consequences of this strict economic policy that Prime Minister Ansip endorsed for many years with enormous losses.

This time everything will be different. The European Commission will allocate up to one hundred billion euros to the SURE instrument, if member states commit to a guarantee payment of 25 billion euros. I would like to stress this precondition: if the member states commit to the guarantees. Currently, we do not have to pay into the EU budget. By the way, the scheme should also include the self-employed.

One more example. There is a Fund for European Aid to the Most Deprived (FEAD). This fund grants money to EU member states to help those most in need of food, clothing and footwear. In this seven-year period, the budget of the fund was 3.8 billion euros. In our country, the fund works in unison with the Social Insurance Fund. FEAD provides aid to sixteen million residents of the EU, including 4.5 million children. Usually, the share of self-financing of a country is 15%. So, the European Commission intends to add 42 million euros this year to the budget and 25 million euros next year for future payments and to reduce the share of self-financing to zero. In other words, to give the deprived more food, clothing and footwear, including in Estonia.

So, if you are told that the EU is twiddling its thumbs, provide a link to this video on my Facebook page. True, at first glance, the work being done at the EU seems to be invisible. However, this is the lubricant, including financial, that helps keep everything working.

Be healthy, and we will meet again in a week.