ABSTRACT
Chapter 3 aims to make a comparative analysis of fiscal responses of the European Union member states and of the United Kingdom to the outbreak of the COVID-19 pandemic. The survey covered measures implemented in 28 European economies between January and November 2020. This study discusses assistance packages offered in all countries, and fiscal and monetary responses in all member states of the European Union. The countries analyzed are divided into the eurozone and other economies.
The lockdown, with its social and economic restrictions imposed in the surveyed countries, resulted in an economic downturn and a loss of 4.5% of GDP in total. Unemployment rose in those countries by 24% on average. Assistance packages were offered to stimulate economies and preserve employment, e.g. subsidies to wages, moratoriums (grace periods) on payment of taxes and repayment of loans, loans and guarantees granted to businesses, purchase of treasury and corporate securities by central banks. Those government responses were financed by public debt that rose in the countries surveyed from 80% to 91% of GDP on average. The Next Generation EU fund was approved at the EU level (EUR 750 billion), and was aimed to support the 2021–2027 financial framework (EUR 1.8 trillion in total). It was observed that governmental assistance was aimed at improved innovation, competitiveness and energy transition.
