French finance minister Bruno Le Maire said the EU had “lost too much time” in rolling out its €750bn recovery plan to overcome the Covid crisis, as Germany and France made a joint pitch for a quick approval in Brussels of member states’ spending programmes.
“We were very efficient last year in the adoption of the European recovery plan and on the decision on common debt issuance,” Le Maire told a press conference by video together with his German counterpart Olaf Scholz on Tuesday. “Since then, we have lost too much time. China has resumed its growth. The US is booming. The EU must remain in the race.”
Scholz said that Germany and France, as well as Italy and Spain, were presenting their national proposals to Brussels this week and that the overall plan lifted EU integration “to a new level”.
The German government said 90 per cent of the €26bn it expects to receive from the recovery fund would go to investments in climate protection and digitalisation, two areas where Europe’s largest economy has been a laggard.
“Today is a good day for Europe,” said Scholz. “The EU recovery fund makes it possible for all other EU countries to also adopt measures in order to emerge stronger from the crisis. We can now take united action towards a strong EU that is based on solidarity and is fit for the future. The German recovery plan sends a clear signal in favour of climate action, digitalisation, growth and jobs.”
France, whose share from the EU will be about €40bn, said half its €100bn national recovery plan would be directed at “climate transition”, including the insulation of buildings to improve efficiency, while a further 25 per cent would be aimed at digitalisation.
Le Maire said the European Commission should analyse national plans as soon as possible so they could be approved at a meeting of EU finance ministers in July. He said: “I think that the money should come as soon as possible, at the latest in September. Once our plan has been adopted by the Council, we should receive a first payment of 13 per cent, which represents €5.1bn in the case of France.”
The two men have also confirmed their support for the Biden administration’s target of a 21 per cent global minimum corporate tax rate to be negotiated at the OECD, although Ireland is expected to demand a lower rate and its EU partners had not expected the US to aim so high after returning to the negotiating table.
France was thwarted by the Trump administration in its push for a global minimum taxation rate and what it sees as fair taxation of big tech platforms such as Google and Facebook, which have often booked profits in low-tax jurisdictions and paid little to the exchequer in the countries where they do much of their business.
“My view is that we are now on a very good track,” Scholz said when asked about the 21 per cent rate proposal, adding that the negotiations were “now in a situation we would never have expected some years ago”. Le Maire said there was now the “historical” chance of a compromise and a deal at the OECD.