![]() The introduction of these policy responses was accompanied by a marked shift in the framing of the challenge facing EU member states: instead of attributing the varying capacity of member states to deal with the pandemic to past more vs. The EU economic policy response was different this time, from the prompt launch of the ECB’s Pandemic Emergency Purchase Programme (PEPP), and the activation of the general escape clause of the Stability and Growth Pact (SGP), to the launch of the Support to mitigate Unemployment Risks in an Emergency (SURE) and the Next Generation EU (NGEU) programme with its Recovery and Resilience Facility (RRF). ![]() The Covid-19 pandemic plunged Europe into the greatest recession since World War II, the second in the space of 12 years. It thus illustrates how the implementation of the EU response to the pandemic in Greece is constrained by the legacy of the previous crisis despite shifts in policy channels through which the EU economic integration has been shaping national capitalisms. This article assesses the risks that the Greek Recovery and Resilience Plan may face, given the economic, social and political legacies of and the lingering conditionality from the previous crisis. Greece has entered the pandemic with vulnerabilities from previous economic adjustment programmes it had to follow, large enough to warrant ‘enhanced surveillance’ by the European Commission, as well as challenging fiscal conditionality to secure some preferential treatment by its Eurozone partners/lenders of its public debt, to improve its fragile sustainability. During the pandemic, there have been apparent shifts in some of these channels. According to the third-generation comparative capitalism literature, EU economic integration has been favouring export-led growth models over domestic-demand led ones through several channels, which included fiscal rules, financial support conditionality and monetary policy. ![]() ![]() Such a move would satisfy Germany, which has for long called for such a fast-tracking of rules, which were originally planned only for 2018.This paper attempts to weigh into the debate on whether and if so, to what extent the policy response to the pandemic of the EU, most notably among others, the Recovery and Resilience Fund of the Next Generation EU, its conditionality, and the response of the ECB, marks a qualitative change rather than echoing the legacies of the previous crisis by looking into the case of Greece. REUTERS/Francois Lenoirīuilding this union has proved divisive as it requires countries to surrender sovereignty and that they pay towards repairing banks in neighboring states.įinancial markets have paid little attention to the debate but there is a risk that failure to reach a final agreement could be taken as a sign the bloc is not capable of protecting itself.Įuropean leaders want a deal by the end of the year so that banking union can begin by 2015, including a quicker introduction of rules to impose losses on senior bondholders and large depositors in failing banks, as was done in Cyprus. (L-R) European Union Economic and Monetary Affairs Commissioner Olli Rehn, Greece's Finance Minister Yannis Stournaras, France's Finance Minister Pierre Moscovici and European Commissioner for Internal Market and Services Michel Barnier attend a European Union finance ministers meeting in Brussels December 10, 2013. ![]()
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