The video conference of the ECOFIN minsters took place on 6 October 2020 and was chaired
by Germany’s Minister of Finance Olaf Scholz. Topics addressed included the following:
- Recovery and Resilience Facility (RRF)
- Digital finance package
- Action plan on building a capital markets union
- Preparations for the meeting of G20 finance ministers and central bank governors and for the annual meeting of the International Monetary Fund (IMF)
Recovery and Resilience Facility (RRF)
The ECOFIN ministers reached an agreement on the Recovery and Resilience Facility (RRF). A large majority of member states see the existing proposal as a balanced compromise and expressed their support for it. Finance Minister Olaf Scholz concluded that the compromise should be adopted soon by the Permanent Representatives Committee (Coreper) as a negotiating mandate with the European Parliament. Consultations with the European Parliament are to be finalised by the end of 2020.
Digital finance package
The European Commission presented the digital finance package published on 24 September 2020. The Commission emphasised in particular that the package is designed to boost the EU’s competitiveness and capacity for innovation in the digital age. This, it stated, is especially relevant with regard to improving European payment services. The Commission explained that the aim is to establish a secure, competitive legal framework for digital innovation in the financial sector. The member states stressed the special significance of instant payments, underlining the importance of regulation and supervision as well as consumer protection. Furthermore, a number of member states underscored the avoidance of regulatory arbitrage, in particular with regard to stablecoins. In its summary, the chair underlined the important role of the package in European sovereignty and stated its intention to continue work on the proposals swiftly.
Action plan on building a capital markets union
The European Commission also presented its action plan on building a capital markets union, published on 24 September 2020. The Commission stated that the capital markets union could make an important contribution to the European economy by providing new financing options for small and medium-sized enterprises (SMEs). This would be important for sustainable, inclusive growth and could boost Europe’s competitiveness. There was a broad consensus among the member states that measures to improve financing for SMEs via the capital markets and incentives for capital market participants to provide long-term financing for the economy should be prioritised. Finance Minister Scholz announced his intention of adopting the Council conclusions regarding the Commission’s action plan before the end of the German Presidency.
Preparations for the G20 and IMF meetings
Furthermore, information was provided on the preparations for the meeting of G20 finance ministers and central bank governors and for the annual meeting of the International Monetary Fund (IMF). Finance Minister Olaf Scholz, as the chair, informed participants that topics to be discussed would include the development of the global economy, the G20 Action Plan in response to the Covid-19 pandemic, the G20’s debt suspension initiative for the 77 poorest countries (DSSI), international taxation and the G20’s agenda for the finance sector.