COVID-19 and the Resilience of European Economy


BY SAMIKA DAGA

The European Union seems to have mimicked Arya Stark’s (fictional character from popular television series, Game of Thrones) approach to the challenges she faces in her life, while dealing with this costly and crushing Coronavirus pandemic. Despite the plunge that European nations faced in the initial stages of the spread of the virus, much like the case in other developed nations such as the United States and China, they are now headed toward a speedy recovery.

Amongst the twenty-seven member states of the European Union, Italy and Spain have shown a sharp decline in their economy. Across the EU on the whole, the economic contraction was 11.9%. [Source: BBC news] Authorities have deemed this to be the largest fall in the economy since 1995 and probably an even more serious blow than the United States, as per figures recorded.

However, there’s a certain attribute that the European Union nations possess that makes them contrasting and distinct compared to other nations across the globe. Amidst the power battle that has consumed the developed nations on Earth, the EU acts as a cohesive unit in order to protect the best interests of its member states. Europe came together to save its citizens, jobs and businesses, making it a role model for the world.

Following the lockdowns implemented in early March, 2020, the European Central Bank set in motion the Pandemic Emergency purchase Program in order to stabilize the financial market of the Eurozone. This program was further expanded in coming months, even to states such as Italy, which was severely in debt but just as badly affected due to the virus. [Source: World Economic Forum]

While individual nations part of the Eurozone implemented different local regulations in order to contain the spread of the virus, the EU together allowed relatively free movement of goods, services as well as people across the Eurozone in order to salvage their economy and finances. Prompt decisions and prudent policies on both a local as well as national level paved the path for resilience.

The captive market of the European Union, where the forces of demand and supply are contained to inter-EU transactions, has played a vital role in accelerating the recovery in some of the most disastrously hit states. The nature of this self-contained market in a major superpower of the world is quite significant and vital to keep the EU’s economy afloat. Due to the lack of clarity on Brexit and the United Kingdom continuing to be a part of the EU as of this day, the economy of the Eurozone is not only on a road to recovery but can rely on an expeditious one with the UK and its resources to contribute to the Union’s recuperation.

The European Union has made a bold statement to become a global leader in economic sustainability. The launch of the European Green Deal to become a low-carbon economy without minimizing economic and financial growth, while improving the lives of its citizens is what the EU is headed towards and will mark its true strength. The reach of this pandemic was far and wide and quite catastrophic, but the coalescence of these twenty-seven states in these turbulent times seem to have only made them more prepared for attacks of a similar nature in the future.

“What doesn’t kill you, makes you stronger”

As said first by German Philosopher Friedrich Nietzsche, the European Union will certainly emerge stronger post this pandemic, and serve as an example to other nations worldwide.

Categories: Economy

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