The crisis triggered by the COVID-19 pandemic has been especially severe for enterprises, mostly SMEs, in tourism, hospitality and culture, not least those based in EU island regions, Labour MEP Alfred Sant told the European Parliament.
During a debate in this week’s plenary session of the European Parliament focusing on the Annual Competition Report that included a number of amendments tabled by Alfred Sant, the former Prime Minister said that state aid is crucial but needs time to work effectively.
The amendments, some of which were co-signed by other MEPs, addressed key issues in particular the impact of COVID-19 on the economy, state aid, culture, the tourism and hospitality industry that were most impacted, and not least the impact this had on island regions.
Alfred Sant pointed out that the termination of major transport connections and the interruption of on-going business relations cannot be brought back to their original base overnight.
“Some would like a so-called “return to normal” on economic regulation to happen as soon as possible. This has no real-life logic to back it, just dogma. The idea that the re-application of state aid rules must follow the same tempo as the “epidemiological situation” is absurd. The two follow different timeclocks”.
“Rather, the exceptional measures adopted under the temporary framework for the hospitality industry sectors affected by the COVID-19 crisis must be maintained, no matter what the received wisdom about competition and other rules says” Alfred Sant told the European Parliament.
“Yes, the lessons of the 2008 financial crisis must be kept in mind. But they cannot be taken as the be-all and end-all compass by which to navigate today’s storm. Otherwise, we risk the collapse of major sectors of activity, like tourism and culture”.
Responding directly to the intervention made by Alfred Sant, the European Commissioner for Competition Margrethe Vestager said that the temporary framework is set to stop by the end of this year but the Commission is already now sharing with Member States, the different things that can be done for the sectors that are really really challenged: tourism, culture, mobility, hospitality.
“For instance to create a fund where a state guarantee crowds in private investment in order to enable capital for the businesses where capital has been totally depleted. That is the thing to do”.
“This is a situation where the state asked businesses because of the health situation to close their doors. Here I think that it is fully legitimate for the state, for us as tax payers, to step in, to make sure they have a fair chance of coming back and do best they can, serve us and be available for the green and digital transition”, Commissioner Vestager told Alfred Sant.