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State aid in the Covid-19 crisis: a European dilemma
[Les aides d’État dans la crise Covid 19 : un dilemme européen]

Author

Listed:
  • Dorothée De Franclieu
  • Émilie Hermet

Abstract

In response to the economic impact of the Covid-19 crisis, the European Commission temporarily relaxed the framework governing the use of State aid. This framework was amended to include more diversified forms of aid, higher ceilings and extended timeframes for granting aid. As evidenced by the widespread implementation of support measures, in particular for the sectors most affected by the crisis, these adjustments were necessary to address the emergency and limit the economic shock. However, the massive and heterogeneous use of public support could, if prolonged beyond what is necessary, distort competition in the internal market and weigh on Member States’ public debt, to the detriment of the European Union’s long-term green and digital objectives. The exit from the emergency aid schemes therefore needs to be prepared. Face à l’impact économique de la crise de la Covid 19, la Commission européenne a assoupli temporairement le cadre régissant le recours aux aides d’État. Des formes d’aides toujours plus diversifiées, des plafonds relevés et des délais d’octroi étendus ont par ailleurs amendé ce cadre. Comme l’atteste la mise en œuvre très large des mesures de soutien, prévues notamment pour les secteurs les plus touchés par la crise, ces ajustements étaient nécessaires pour faire face à l’urgence et limiter le choc économique. Toutefois, l’utilisation massive et hétérogène des mesures pourrait, si elle était prolongée au dela du nécessaire, favoriser des distorsions de concurrence sur le marché intérieur et peser sur l’endettement public des États membres, au détriment des objectifs de long terme écologiques et numériques de l’Union européenne. La sortie des régimes d’aide d’urgence devra donc être anticipée.

Suggested Citation

  • Dorothée De Franclieu & Émilie Hermet, 2021. "State aid in the Covid-19 crisis: a European dilemma [Les aides d’État dans la crise Covid 19 : un dilemme européen]," Bulletin de la Banque de France, Banque de France, issue 238.
  • Handle: RePEc:bfr:bullbf:2021:238:03
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    File URL: https://publications.banque-france.fr/sites/default/files/medias/documents/bulletin-banque-de-france_238-3_aides-d-etat.pdf
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    References listed on IDEAS

    as
    1. Massimo Motta & Martin Peitz, 2020. "State Aid Policies in Response to the COVID-19 Shock: Observations and Guiding Principles," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 55(4), pages 219-222, July.
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