ICSA SAYS EU MUST ENSURE INCREASED MONEY SUPPLY AND PROGRESS BREXIT TRADE TALKS-ACTION REQUIRED FAST IN FACE OF COVID-19

16 MARCH 2020

 

ICSA president Edmond Phelan has said that Covid-19 will cause unprecedented economic hardship unless the EU acts rapidly and in unison. “While the immediate focus is on saving lives and slowing the spread of the virus, we also need clear and decisive action to mitigate the potential for economic catastrophe. ICSA is calling on the Taoiseach, working in concert with other EU leaders, to insist on a massive programme of quantitative easing (increasing the money supply in the Eurozone) by the European Central Bank. We also want to see Brexit talks progressed regardless.”

“While the ECB guards its independence at all times, these are not normal times. It is therefore necessary for all EU heads of state to make whatever changes are necessary. This is not a time for the ECB to fiddle while Europe burns. We have seen how the ECB decision making process left a lot to be desired under Jean Claude Trichet during the economic crash. We cannot allow indecision to cause massive suffering across Europe and in recent days, we have seen Italy turn to China for help, apparently frustrated at the lack of decisive EU assistance. This is not acceptable.”

“The normal reason to oppose quantitative easing is inflation but there is no risk of that as economic activity collapses. The impact is already widespread as we have seen with the closure of bars and restaurants, the collapse of tourism and the impact on normal working patterns. VAT and payroll taxes will be down substantially while social welfare and health spending will escalate. In that scenario, we need extra money to cover all of the escalating national exchequer requirements and we need member states to be able to fully fund CAP as well.”

“It is also vital that the work of negotiating an EU/UK trade deal goes ahead. We simply cannot afford to put this on the back burner and it is surely possible to manage the negotiations by way of small teams observing strict distancing and high tech video conferencing. Brexit has caused enough disruption and the unfortunate deadline imposed by the UK means there is no room for delay.”

ENDS