Previously published in FINANCE & DEVELOPMENT, JUNE 2020, VOL. 57, NUMBER 2 | By Daniel Susskind, James Manyika, Jean Saldanha, Sharan Burrow, Sergio Rebelo, and Ian Bremmer
Six prominent thinkers reflect on how the pandemic has changed the world
Daniel SUSSKIND is a fellow in economics at Balliol College, Oxford University, and author of A World Without Work (Allen Lane, 2020).
In March 2020, Rabbi Jonathan Sacks, an influential figure in British intellectual life, described the COVID-19 catastrophe as “the nearest we have to a revelation for atheists.”
At the time I thought the comparison was apt. It captured the biblical sense of shock that many of us felt in the face of such a sudden, extreme, and swiftly accelerating crisis. We “have been coasting along for more than half a century,” he remarked, and all at once “we are facing the fragility and vulnerability of the human situation.”
Now, a few months on, Rabbi Sacks’ comparison with revelation still seems fitting, but for a different reason, and one that matters for thinking about a world after COVID-19.
This crisis is alarming, in part, because it has several new and unfamiliar features. A global medical emergency caused by a virus we still do not fully understand. A self-inflicted economic catastrophe as a necessary policy response to contain its spread.
And yet as time has passed, it has also become clear that much of what is most distressing about this crisis is not new at all. Striking variations in COVID-19 infections and outcomes appear to reflect existing economic inequalities. Remarkable mismatches between the social value of what “key workers” do and the low wages they receive follow from the familiar failure of the market to value adequately what really matters.
The happy embrace of disinformation and misinformation about the virus was to be expected, given a decade of rising populism and declining faith in experts. And the absence of a properly coordinated international response ought to have come as no surprise, given the celebration of “my country first” global politics in recent years.
The crisis then is a revelation in a far more literal sense—it is focusing our collective attention on the many injustices and weaknesses that already exist in how we live together. If people were blind to these faults before, it is hard not to see them now.
What will the world look like after COVID-19? Many of the problems we will face in the next decade will simply be more extreme versions of those that we already confront today. The world will only look significantly different this time if, as we emerge from this crisis, we decide to take action to resolve these problems and bring about fundamental change.

James MANYIKA is chairman and director of the McKinsey Global Institute.
The world after COVID-19 is unlikely to return to the world that was. Many trends already underway in the global economy are being accelerated by the impact of the pandemic.
This is especially true of the digital economy, with the rise of digital behavior such as remote working and learning, telemedicine, and delivery services. Other structural changes may also accelerate, including regionalization of supply chains and a further explosion of cross-border data flows.
The future of work has arrived faster, along with its challenges—many of them potentially multiplied—such as income polarization, worker vulnerability, more gig work, and the need for workers to adapt to occupational transitions. This acceleration is the result not only of technological advances but also of new considerations for health and safety, and economies and labor markets will take time to recover and will likely emerge changed.
With the amplification of these trends, the realities of this crisis have triggered reconsideration of several beliefs, with possible effects on long-term choices for the economy and society. These effects range from attitudes about efficiency versus resilience, the future of capitalism, densification of economic activity and living, industrial policy, our approach to problems that affect us all and call for global and collective action—such as pandemics and climate change—to the role of government and institutions.
Over the past two decades, in advanced economies, responsibility has generally shifted from institutions to individuals. Yet health systems are being tested and often found wanting, while benefits from paid sick leave to universal basic income are getting a second look. There is potential for a long-term shift in how institutions support people, through safety nets and a more inclusive social contract.
As history has shown, choices made during crises can shape the world for decades to come. What will remain critical is the need for collective action to build economies that deliver inclusive economic growth, prosperity, and safety for all.

Jean SALDANHA is director of the European Network on Debt and Development.
In The Pandemic Is a Portal, Indian author Arundhati Roy writes, “Historically, pandemics have forced humans to break with the past and imagine their world anew. This one is no different. It is a portal, a gateway between one world and the next.”
The way multilateralism operates will have to change to reflect this very different world. The COVID-19 pandemic has been testing the limits of global cooperation. Support for developing economies in particular remains inadequate. They were hit early by the global economic downturn, including through record capital outflows and tightening financial conditions. Facing the worst humanitarian crisis since World War II, these economies are experiencing unprecedented pressure on their already limited fiscal capacity to tackle urgent public health and social needs.
Choices made now will have far-reaching consequences. Reliance on more of the same is untenable and ignores the scale of human suffering unleashed by the pandemic.
A fitting UN-led reform agenda must include the IMF in addressing the structural problems that have driven debt vulnerability across developing economies. Such an agenda must shift development finance away from market-friendly reforms and incentives for private investment. It must abandon the dogma of austerity. Furthermore, rich countries must finally meet their official development assistance commitments.
Power imbalances in global institutions must also be corrected to give fair recognition to the needs and rights of the two-thirds of the world’s population who reside in the Global South.
If the international community fails to respond decisively now, the 2030 Agenda and the Paris Agreement will be fatally derailed. A new multilateralism—in which reform of the Bretton Woods institutions will play a key role—is needed now and must be based on a vision of development that puts human rights, gender equality, and climate at its center.

Sharan BURROW is general secretary of the International Trade Union Confederation.
The world after the first wave of COVID-19 must be more inclusive, resilient, and sustainable. Today, we live in a world in which inequality between and within countries has grown as a result of businesses’ race to the bottom and working poverty among a vast portion of the global workforce. Too many countries suffered the external shocks of COVID-19 without universal social protection, robust public health systems, a plan to reach net-zero carbon emissions by 2050, or a sustainable real economy with quality jobs.
The Bretton Woods conference occurred while a war was still raging and helped formed the basis of a postwar social contract. Similarly, we need to craft an ambitious reconstruction plan while working to end the pandemic. International support is a matter of collective survival and an investment in the future of health, the global economy, and multilateralism. The choice is ours, and the actions of the IMF and the multilateral system will be a deciding factor.
Our goal for recovery should be full employment and a new social contract. Public investment in the care economy, education, and low-carbon infrastructure can form the backbone of stimulus that reduces inequality. Wage policy, collective bargaining, and labor market regulation can revive demand and income while putting an end to a business model that allows companies to take no responsibility for their workers.
Debt should be addressed through a relief process focused on the United Nations Sustainable Development Goals and enduring economic growth for every country. Shortsighted fiscal consolidation hindered debt management and reduction after the global financial crisis and would again leave us even less able to deal with future health and economic crises.
Shared prosperity can be the fruit of a COVID-19 world marked by shared ambition and global solidarity.

Sergio REBELO is a professor of international finance at the Kellogg School of Management at Northwestern University.
COVID-19 will leave a lasting imprint on the world economy, causing permanent changes and teaching important lessons.
Virus screening is likely to become part of our life, just like security measures became ubiquitous after 9/11. It is important to invest in the infrastructure necessary to detect future viral outbreaks. This investment protects economies in case immunity to COVID-19 turns out to be temporary.
Many economies adopted versions of Germany’s Kurzarbeit (short work) subsidy during the pandemic. This policy keeps workers employed at reduced hours and pay, with the government compensating some of the shortfall in wages. By keeping matches between firms and workers intact, the economy is better prepared for a quick recovery. It is important to improve the implementation of these policies and make them a permanent part of our economic recovery tool kit.
Remote work is likely to become more common. We had some evidence that working from home is at least as productive as working at the office. However, many companies were reluctant to embrace remote work. Now that many have tried it with good results, remote work might be here to stay.
The pandemic crisis has accelerated the pace of digital transformation, with further expansion in e-commerce and increases in the pace of adoption of telemedicine, videoconferencing, online teaching, and fintech.
Companies with international supply chains are dealing with shortages and bottlenecks. We are likely to see many of these companies reshore some of their production. Unfortunately, this trend will not create many jobs because most of the production is likely to be automated.
Governments will be bigger after playing the role of insurer and investor of last resort during the crisis. Public debt will balloon, creating financial challenges around the world.
The most important lesson from the COVID-19 pandemic is the importance of working together on problems that affect the entire human race. We are much stronger united than divided.

Ian BREMMER is president and founder of Eurasia Group.
The global order was in flux well before the COVID-19 crisis. Coronavirus has accelerated three of the key geopolitical trends that will shape our next world order… which will await us on the other side of this pandemic.
The first trend is deglobalization; the logistic difficulties brought to light by the current crisis are already pointing to a shift away from global just-in-time supply chains. Yet as economic difficulties mount, the inevitable growth of nationalism and “my nation first” politics will push companies to localize business operations that favor national and regional supply chains.
The third trend, China’s geopolitical rise, has been more than three decades in the making. But while China has successfully transformed itself into an economic and technological superpower, no one expected it to become a “soft power” superpower. This crisis can change that, if China’s crisis diplomacy continues and the perception endures that Beijing has been far more effective than the rest of the world in its response to the outbreak.
Of course, just because China appears to be faring better doesn’t mean it actually is. There’s a reason people take Chinese numbers with a grain of salt. This general distrust was further fueled by the initial Chinese cover-up of the outbreak, which enabled its global spread. Donald Trump and his administration are leaning into this narrative as an election strategy and to deflect attention from their own handling of the pandemic. China won’t take this lying down, making it increasingly likely that once the world emerges from the current pandemic, we will be plunged into a new cold war, this time between the United States and China.
New world order or not, some things just don’t change.

Compliments of the IMF F&D.

Today, the European Commission launched a major review of the European Union’s trade policy, including a public consultation seeking input from the European Parliament, Member States, stakeholders and civil society. The Commission’s objective is to build a consensus around a fresh medium-term direction for EU trade policy, responding to a variety of new global challenges and taking into account the lessons learned from the coronavirus crisis.
A strong European Union needs a strong trade and investment policy to support economic recovery, create quality jobs, protect European companies from unfair practices at home and abroad, and ensure coherence with broader priorities in the areas of sustainability, climate change, the digital economy and security.
Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People, said: “To help repair the economic and social damage brought by the coronavirus pandemic, kick-start European recovery, and protect and create jobs, we have recently proposed a major recovery plan for Europe based on harnessing the full potential of the EU budget. The European Union is the world’s trading superpower. Open and rules-based trade will contribute significantly to the global recovery.  We need to make sure that trade policy serves our citizens and companies. Today, we launch a trade policy review in order to adjust the EU’s approach to the global trade at this critical moment for the global economy.”
Phil Hogan, Commissioner for Trade, commented: “The current pandemic is reshaping the world as we know it, and our trade policy must adapt to be more effective in pursuing European interests.So today we are asking for the views of our citizens and stakeholders to help us develop a bespoke EU trade policy approach for the post-coronavirus world. We want our policy to continue benefiting our people and our companies, enhancing our global leadership ambitions across a range of areas while taking a tougher approach to defend ourselves from any hostile or abusive actions. We must keep trade free and fair, underpinned by appropriate rules both within the EU27 and globally. With this review, we will listen to everyone who has a stake.”
The results of this consultation will feed into a communication to be published towards the end of the year. The final review will be the result of a transparent and inclusive process including the online public consultation, discussions with the European Parliament and Member States, as well as engagement with relevant stakeholders and civil society representatives.
The consultation covers all relevant topics to the EU trade policy, with a special focus on the following:
Building a resilient and sustainable EU economy after the coronavirus
Reforming the World Trade Organization
Creating global trade opportunities for businesses and in particular small and medium sized enterprises.
Maximising the contribution of trade policy to addressing key global challenges such as climate change, sustainable development or the digital transition
Strengthening of trade and investment relationships with key trading partners
Improving the level playing field and protecting EU business and citizens
More information is available in a consultation note published today. Written comments can be submitted by 15 September 2020.
Compliments of the European Commission.

While all of us have tried to stay hopeful during these challenging times, after watching our cities and our citizens explode over the latest appalling incidents of racial injustice surrounding George Floyd, Breonne Taylor, Ahmaud Arbery and so many more; staying hopeful has become the most daunting of challenges.  Where can you turn? What can you do?  What next?
We stand firmly behind the peaceful protests and protesters who are exercising their constitutional rights to speak out against racial injustice.  In the midst of a global pandemic and stay at home orders, citizens of all races have taken to the streets – from Minneapolis to Philadelphia, New York to Atlanta and Detroit to Los Angeles.  They must be heard.  We all must listen, learn and remember.
Let’s not let the looting by a few take away from the message that racism has no place in a civil society.  If we can advance further in our united goal to regard an individual by his or her deeds and not by the color of their skin, then the voices have been heard.
EACCNY will provide a platform for members to showcase what actions they have taken. We will be in touch with our members on both sides of the Atlantic to check in what they have done in about 6 month and again in a year to check in how they concretely made a difference in Black and Minority lives they work with and serve.
Please join with us to end racism across the globe.
Compliments of the European American Chamber of Commerce New York Staff.

Together with our members we are creating a Video series of first-hand accounts of the Pandemic’s impact, both personally & professionally.
We invite you to join us today for a first-hand look at the impact of the global shutdown following the Coronavirus (COVID-19) outbreak – Today we are featuring Markus Börlin, Swiss Ambassador & Consul General NY a Member of the EACCNY.
The questions we asked our members for this series are:
1) What are some challenges you, personally and your organization have faced?2) What are some of the most surprising (positive, innovative) responses/changes you have witnessed?3) How will this experience change us going forward, as a society and in terms of how we do business?

EACCNY has its finger on the pulse of how this worldwide pandemic is effecting companies and organizations on both sides of the Atlantic. EACC is where Americans & Europeans connect to do business.
Stay tuned for more on this series! We hope you enjoy these short vignettes our members and friends of the EACC created to share their experience.

Blog post by EU High Representative Josep Borrell |
Rising international tensions and conflicts at the doorstep of Europe urge us to take our collective security into our own hands. Lately, four major Member States advocated making security and defence a top priority for the Union. I fully agree: since the beginning of the mandate of this Commission, we have placed our Common Security and Defence Policy at the very heart of the EU’s external policy. And while we have a long way to go, there is now an increased momentum to strengthen our collective capacity for action.
“We have a long way to go, but there is an increased momentum to strengthen our collective capacity for action on security and defence.” – HR/VP Josep Borrell
At our EU Defence Ministers meeting earlier this week, we have set out an ambitious agenda to strengthen our ability to act autonomously as a Union whenever necessary and, at the same time, make the EU a better global partner and security provider.
In order to raise our Common Security and Defence Policy to the necessary level, we intend to improve our capabilities, develop our potential for common operations, enhance our partnerships and adapt our structures to new threats and a modified environment.
We are now beginning to work on a future Strategic Compass. What we need primarily in Europe is a common strategic culture: a common way of looking at the world, of defining threats and challenges as the basis for addressing them together. The Strategic Compass should help us get there. To kick off this process, I will present an intelligence-led threat analysis to Member States before the end of 2020.
Also by the end of the year, we have to reach an agreement on the 2021-2025 priorities for one of the core instruments of our security and defence policy, the Permanent Structured Cooperation (PESCO). At the same time, we need to spell out the conditions for third states’ participation in PESCO projects, which would allow us to act on a larger scale if necessary.
Equally urgent is the need to strengthen our tools to counter hybrid threats, including disinformation and cyber-attacks. The outbreak of Covid-19 has been a stark reminder of how critical the subject has become to protect our societies.
We must also develop the European defence industrial and technological base and reduce our critical dependencies from external suppliers. This week’s announcement on the first projects selected for funding under the European Defence Industrial Development Programme, demonstrates the potential in that area.
Yet if we want to be credible, our objectives need to be backed by adequate budgetary means. Hence the importance to reflect our security and defence priorities in the negotiations of the next EU budget for 2021-2017: all our ambitions in the area of operations, capabilities and resilience ultimately depend on the availability of financial resources. We also need to strengthen our capacity of action outside Europe: the new EUR 8 billion European Peace Facility will enhance the credibility of our efforts to collectively promote peace and security beyond our borders.
Member States have a key role to play in this budgetary challenge. At a time of increased global uncertainty, they need to maintain their levels of defence spending and avoid cuts at the expense of our collective security. Above all, Member States need to spend together, through common procurement and on commonly agreed capability shortfalls.
Our global partnerships remain a cornerstone of European security and defence. Working closely with NATO Secretary General Stoltenberg, we made pragmatic proposals to strengthen further our cooperation in areas such as military mobility and exercises. By reinforcing our capabilities in security and defence, Europe is strengthening the transatlantic alliance. We also intend to develop further our partnership with the United Nations, a concrete demonstration of EU’s commitment to a rules-based international order.
It is by advancing together on these different tracks that we will be able to gradually build and implement a credible and effective EU security and defence agenda. We will go decisively ahead on this front with the support of all EU Member States.
Compliments of the European External Action Service (EEAS).

The Federal Reserve today published the FraudClassifier model—a set of tools and materials to help provide a consistent way to classify and better understand the magnitude of fraudulent activity and how it occurs across the payments industry. The model was developed by the Fraud Definitions Work Group, which was comprised of Federal Reserve and payments industry fraud experts.
“The FraudClassifier model can help address the industrywide challenge of inconsistent classifications for fraud involving ACH, wire, or check payments,” said Jim Cunha, secure payments strategy leader and senior vice president at the Federal Reserve Bank of Boston. “The FraudClassifier model enables payments stakeholders to classify fraud in a simple and similar manner. It can be applied across an organization to help ensure greater internal consistency in fraud classification, more robust information and better fraud tracking.”
The key advantage of the FraudClassifier model is the ability for organizations to use it to classify fraud independently of payment type, payment channel or other payment characteristics. The model presents a series of questions, beginning with who initiated the payment to differentiate payments initiated by authorized or unauthorized parties. Each of the classifications is supported by definitions that allow for consistent application of the FraudClassifier model across the industry.
The Fraud Definitions Work Group also developed and recommended an industry adoption roadmap, which outlines a strategy and potential steps to encourage voluntary industrywide use of the FraudClassifier model.
Learn more—and sign up to access educational resources and support tools for the FraudClassifier model—by visiting FedPaymentsImprovement.org.
About the Federal Reserve and Payments
As the U.S. central bank, the Federal Reserve System provides payment services and seeks to foster the stability, integrity and efficiency of the nation’s monetary, financial and payment systems. In 2013, the Federal Reserve initiated a broadly collaborative effort to enhance the end-to-end speed, security and efficiency of payments in the United States. As an outcome of that collaboration, the Federal Reserve is committed to pursuit of five desired outcomes outlined in the 2015 Strategies for Improving the U.S. Payment System (PDF) paper: speed, security, efficiency, international payments and collaboration.
Compliments of the Federal Reserve Board.

“Addressing the tax challenges arising from the digitalisation of the economy is long overdue,” said OECD Secretary-General Angel Gurría. “All members of the Inclusive Framework should remain engaged in the negotiation towards the goal of reaching a global solution by year end, drawing on all the technical work that has been done during the last three years, including throughout the COVID-19 crisis. Absent a multilateral solution, more countries will take unilateral measures and those that have them already may no longer continue to hold them back. This, in turn, would trigger tax disputes and, inevitably, heightened trade tensions. A trade war, especially at this point in time, where the world economy is going through a historical downturn, would hurt the economy, jobs and confidence even further. A multilateral solution based on the work of the 137 members of the Inclusive Framework at the OECD is clearly the best way forward,” Mr Gurría said.
Mandated in 2018 by the G20 to deliver a consensus based solution by the end of 2020, the OECD has gathered 137 countries on an equal footing for the negotiations and has developed a two pillar approach, to be discussed in the following weeks leading up to a meeting of the Inclusive Framework in October 2020.
The OECD will maintain its schedule of meetings to offer all members of the Inclusive Framework a place in the design of a multilateral approach.
Compliments of the OECD.

The European Commission has adopted a White Paper dealing with the distortive effects caused by foreign subsidies in the Single Market. The Commission now seeks views and input from all stakeholders on the options set out in the White Paper. The public consultation, which will be open until 23 September 2020, will help the Commission to prepare for appropriate legislative proposals in this area.
Executive Vice-President Margrethe Vestager, in charge of competition policy and  responsible for the cluster Europe Fit for the Digital Age, said: “Europe’s economy is open and closely interlinked to the rest of the world. If this is to remain a strength, we must stay vigilant. That is why we need the right tools to ensure that foreign subsidies do not distort our market, just as we do with national subsidies. Today’s White Paper launches an important discussion on how to address effects caused by foreign subsidies. The Single Market is key to Europe’s prosperity and it only works well if there is a level playing field.”
Commissioner for the Internal Market, Thierry Breton, said: “With today’s White Paper we deliver a key element for our vision of Europe’s New Industrial Strategy based on competition, open markets and a strong Single Market. The level playing field in the Single market is at the heart of this initiative and will help our companies operate and compete globally and thus promote the EU’s open strategic autonomy. As part of our Single Market rule book we need to prevent foreign subsidies from distorting procurement procedures and ensure that firms benefit from fair access to public contracts.”
Commissioner for Trade Phil Hogan said “The EU is amongst the most open economies in the world, attracting high levels of investment from our trading partners. However, our openness is increasingly being challenged through foreign trade practices, including subsidies that distort the level playing field for companies in the EU. Along with other tools available at EU level such as foreign direct investment screening and trade defence measures, the White Paper is a welcome addition to the toolbox for our open strategic autonomy.”
EU competition rules, trade defence instruments and public procurement rules play an important role in ensuring fair conditions for companies in the Single Market.
Subsidies by Member States have always been subject to EU State Aid rules to avoid distortions. Subsidies granted by non-EU governments to companies in the EU appear to have an increasing negative impact on competition in the Single Market, but fall outside EU State aid control. There is a growing number of instances in which foreign subsidies seem to have facilitated the acquisition of EU companies or distorted the investment decisions, market operations or pricing policies of their beneficiaries, or distorted bidding in public procurement, to the detriment of non-subsidised companies.
Moreover, the existing trade defence rules relate only to exports of goods from third countries and thus do not address all distortions caused by foreign subsidies granted by non-EU countries. Where foreign subsidies take the form of financial flows facilitating acquisitions of EU companies or where they directly support the operation of a company in the EU, or facilitate bidding in a public procurement procedure, there appears to be a regulatory gap.
The White Paper therefore proposes solutions and calls for new tools to address this regulatory gap. In this context, it puts forward several approaches. The first three options (so-called “Modules”) aim at addressing the distortive effects caused by foreign subsidies (i) in the Single market generally (Module 1), (ii) in acquisitions of EU companies (Module 2) and (iii) during EU public procurement procedures (Module 3). These Modules may be complementary to each other, rather than alternatives. The White Paper also sets out a general approach to foreign subsidies in the context of EU funding.
General instrument to capture distortive effects of foreign subsidies (“Module 1”)
Module 1 proposes the establishment of a general market scrutiny instrument to capture all possible market situations in which foreign subsidies may cause distortions in the Single Market.
Under this Module, the supervisory authority, which would be a national authority or the Commission, could act upon any indication or information that a company in the EU benefits from a foreign subsidy. If the existence of a foreign subsidy is established, the authority would then impose measures to remedy the likely distortive impact, such as redressive payments and structural or behavioural remedies. However, it could also consider that the subsidised activity or investment has a positive impact, which outweighs the distortion and not pursue the investigation further (the “EU Interest Test”).
Foreign subsidies facilitating the acquisition of EU companies (“Module 2”)
The first module could be complemented by Module 2, which is intended to specifically address distortions caused by foreign subsidies facilitating the acquisition of EU companies. This module aims at ensuring that foreign subsidies do not confer an unfair benefit on their recipients when acquiring (stakes in) EU companies, either directly by linking a subsidy to a given acquisition or indirectly by de facto increasing the financial strength of the acquirer.
Under Module 2, companies benefitting from financial support of a non-EU government would need to notify their acquisitions of EU companies, above a given threshold, to the competent supervisory authority. The White Paper proposes that the Commission is the competent supervisory authority. Transactions could not be closed whilst the Commission’s review is pending. Should the supervisory authority find that the acquisition is facilitated by the foreign subsidy and distorts the Single Market, it could either accept commitments by the notifying party that effectively remedy the distortion or, as a last resort, it could prohibit the acquisition. Under this Module, the Commission could also apply the EU Interest Test.
Foreign subsidies in EU public procurement procedures (“Module 3”)
Foreign subsidies could also have a harmful effect on the conduct of EU public procurement procedures. This issue is addressed under Module 3. Foreign subsidies may enable bidders to gain an unfair advantage, for example by submitting bids below market price or even below cost, allowing them to obtain public procurement contracts that they would otherwise not have obtained. Under this Module, the White Paper proposes a mechanism where bidders would have to notify the contracting authority of financial contributions received from non-EU countries. The competent contracting and supervisory authorities would then assess whether there is a foreign subsidy and whether it made the procurement procedure unfair. In this case, the bidder would be excluded from the procurement procedure.
Foreign subsidies in the context of EU funding
Finally, the White Paper sets out ways to address the issue of foreign subsidies in the case of applications for EU financial support. All economic operators should compete for EU funding on an equal footing. Foreign subsidies may however distort this process by putting the beneficiaries of such subsidies in a better position to apply. The White Paper proposes options to prevent such unfair advantage. Among others, in case of funding distributed through public tenders or grants, a similar procedure would apply as the one foreseen for EU public procurement procedures. Moreover, the White Paper emphasises the importance of ensuring that international financial institutions that implement projects supported by the EU budget, like EIB or EBRD, mirror the approach to foreign subsidies.
Next Steps
The White Paper is now open for public consultation until 23 September 2020. In light of the input received, the Commission will present appropriate legislative proposals to tackle the distortive effects of foreign subsidies on the Single Market.
Background
The European Council in its Conclusions of the meeting on 21 and 22 March 2019 tasked the Commission to identify new tools to address the distortive effects of foreign subsidies on the Single Market.
In its Communication “A New Industrial Strategy for Europe” of 10 March 2020, the Commission confirmed that by mid-2020 it would adopt a White Paper on an Instrument on Foreign Subsidies, to address distortive effects caused by foreign subsidies within the Single Market.
For more information
Factsheet: White Paper on Foreign Subsidies
DG Competition website on Foreign Subsidies
Compliments of the European Commission.

Together with our members we are creating a Video series of first-hand accounts of the Pandemic’s impact, both personally & professionally.

We invite you to join us today for a first-hand look at the impact of the global shutdown following the Coronavirus (COVID-19) outbreak – Today we are featuring Feargal O’Sullivan, CEO, USAM Group a Member of the EACCNY.
The questions we asked our members for this series are:1) What are some challenges you, personally and your organization have faced?2) What are some of the most surprising (positive, innovative) responses/changes you have witnessed?3) How will this experience change us going forward, as a society and in terms of how we do business?

 
EACCNY has its finger on the pulse of how this worldwide pandemic is effecting companies and organizations on both sides of the Atlantic. EACC is where Americans & Europeans connect to do business.
Stay tuned for more on this series! We hope you enjoy these short vignettes our members and friends of the EACC created to share their experience.

Working group recommends voluntary compensation for legacy swaption contracts
Market participants advised to contact swaption counterparties to discuss and decide on voluntary compensation
No single preferred option for implementing voluntary compensation, but several potential modalities identified.
The private sector working group on euro risk-free rates has today endorsed a recommendation that counterparties voluntarily exchange compensation for legacy swaption contracts affected by the transition of central counterparty discounting from the euro overnight index average (EONIA) to the euro short-term rate (€STR), which is planned for around 27 July 2020.
The working group, whose members come from the private sector, acknowledges that the modalities for implementing voluntary compensation may vary. It decided not to recommend one approach above others, as market feedback did not single out a preferred option. There was also no consensus around the scope of the swaption contracts to be compensated. The working group is also sharing additional information on what appear to be the most feasible and preferred options with market participants to assist them in making their own decisions.
The working group notes that this recommendation is based solely on feedback received from the public consultation launched in March of this year. It also stresses that any agreement between counterparties to make adjustments to their contracts or exchange compensation, whether based on the working group recommendation or not, would be entirely voluntary.
Compliments of the European Central Bank.