Measures and impacts related to the Covid-19 crisis: first set of decisions

 

The widespread crisis caused by the Covid-19 pandemic has led to a first set of decisions at national and EU level. Support for the general economy represents a total of 947 billion euros.

– At the level of the European Commission, a second package of measures was adopted on 2 April 2020:

The Coronavirus response investment initiative plus (CRII+) complements the first set by introducing exceptional flexibility and simplification in the use of the European structural investment funds (ESIF), including the European agricultural fund for rural development (EAFRD).

Regarding the EAFRD, the CRII+ will support farmers, rural areas and EU countries by increasing flexibility in the use of those funds, including:

• flexibility in the use of financial instruments: Farmers and other rural development beneficiaries will be able to benefit from loans or guarantees of up to €200,000 at favourable conditions, such as very low interest rates or favourable payment schedules.
• reallocation of funds: EU countries will be allowed to use money left unused under their rural development programmes (RDP), rather than sending it back into the EU budget. The money will still have to be used in the framework of the respective RDP.
• postponement for the submission of annual reports: the deadline for EU countries to submit these reports on the implementation of their RDPs is postponed, giving more time to national authorities to put it together.
• no amendments to partnership agreements required: EU countries will not have to amend their partnership agreements to modify their RDPs, lifting some administrative procedures.

In addition to the measures directly linked to the EAFRD under the CRII+, the Commission is proposing further flexibility and simplification of other CAP instruments:

• Extension of deadline for CAP payment applications: the deadline will be extended by a month, from 15 May to 15 June 2020.
• Higher advances of payments: in order to save the cash flow of farmers, the Commission will increase the available advances’ rates of direct payments (from 50% to 70%) and rural development payments (from 75% to 85%). Farmers will be able to start receiving these advances from October 16th.
• Reduction of physical on-the-spot checks and leeway for timing requirements: EU countries have to carry out checks to ensure that eligibility conditions are met. However, in the current exceptional circumstances, it is crucial to minimise physical contact between farmers and the inspectors carrying out the checks. This measure will help reduce administrative burden and avoid unnecessary delays.

 

– This second package complements the first measures, which included:

• Extension of the deadline for submitting CAP payment claims for Italy: the new deadline for submitting claims is 15 June 2020 instead of 15 May.
• Strengthening the possibilities for state aid: Under the recently adopted Temporary Framework for state aid, farmers can now receive up to €100,000 of aid per farm and food processing and marketing companies up to €800,000. These amounts can be complemented by de minimis aid. The ceiling for this aid has recently been increased to €20,000 (and up to €25,000 in certain cases).
• Continuity of movement of food products throughout the EU: The Commission works closely with Member States to ensure the functioning of the single market for goods through the establishment of dedicated lanes (“green lanes”). Checks at border crossing points designated for these lanes will last no more than 15 minutes. The passage is now authorised for all goods, including agri-food products.

 

– At Council level, in order to support the most vulnerable states, the decision to apply the general derogation clause and to suspend the obligations of the Stability and Growth Pact for expenditure related to Covid-19 was taken, and ministers began to explore the modalities of using the European Stability Mechanism.

– In the Member States, national plans have been adopted for an amount equivalent to 2% of the Union’s GDP, plus cash for businesses and workers amounting to 10-13% of the Union’s GDP. Details of the economic decisions are available here.

 

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