European Commission working to avoid double-dip recession

The European Commission is working to avoid the risk of a double-dip recession in the continent due to the ongoing Covid-19 pandemic that has hit economies hard, Paolo Gentiloni, the European Commissioner for Economy, said.

Explaining the priorities of the Commission’s guidance for the member states of the European Union (EU) in its autumn semester package, Gentiloni on Wednesday underlined that “emergency response and transformation should go hand in hand”, reports Xinhua news agency

He noted that Europe was seeking a strong recovery in the third quarter, but that was interrupted by the resurgence of the pandemic.

“Our view is that we are not having a ‘V-shaped’ recovery… We will have an incomplete and uneven recovery over the coming two years with persistently high uncertainty and multiple risks,” the Commissioner warned.

He said the Commission was urging the continuation of short-term policies that address the crisis and support the recovery as well as pursue investments and reforms to strengthen economic and social resilience.

The Commission’s Executive Vice-President for An Economy that Works for People, Valdis Dombrovskis, said the package aims to steer EU economies into calmer waters and provide policy guidance for collective recovery.

“We have taken the right approach to this crisis by coordinating our policy response: monetary, fiscal and social, accompanied by supervisory and regulatory policies for the financial sector,” he Dombrovskis, adding that the package is “instrumental in cushioning the impact of the crisis and making sure that we are able to bounce back from it”.

Both Gentiloni and Dombrovskis called on EU member states to reach an agreement on the next seven-year budget and a recovery fund linked to it, a package totalling 1.82 trillion euros ($2.17 trillion) designed to support the economic recovery of the bloc.

“People and businesses are waiting. All sides should take their responsibilities to make sure that we will get the full recovery package done,” Dombrovskis added.

As of Thursday, the overall Covid-19 caseload and death toll in Europe stood at 14,750,809 and 336 422, respectively, according to the European Centre for Disease Prevention and Control.