New rules on transparency and sustainability are set to transform the way EFSA carries out its role as risk assessor in the EU food safety system.
A new regulation passed by the European Parliament and Council of the EU, which will apply from 27 March, will bolster the Authority’s ability to carry out its risk assessments in accordance with the highest transparency standards.
The regulation will strengthen the reliability and transparency of the scientific studies submitted to EFSA and reinforce the governance of the Authority to ensure its long-term sustainability.
Bernhard Url, EFSA’s Executive Director, said: “This is a pivotal moment for the assessment of risks in the food chain in the EU. EFSA is grateful to the European Parliament, to the European Commission and to the EU Member States for giving us this opportunity to bring citizens and stakeholders closer to our work and to benefit from greater scrutiny of our working  processes and practices.”
Among other initiatives to support implementation of the regulation, EFSA has rolled out new tools and a dedicated web portal to help stakeholders adapt to the new arrangements. The new portal will be live from 30 March.
A series of training sessions and webinars has also been organised.
The implementation process has been executed in collaboration with EFSA’s stakeholders and partners such as the European Chemicals Agency (ECHA) and Member States .
The new arrangements will apply to new mandates and applications and cannot be implemented retroactively. This means that there will be a period of adjustment during which much of EFSA’s ongoing work will continue to be carried out under the previous rules and legal provisions.
Mr Url said: “This is a big logistical challenge, and we have committed significant resources to ensuring that the transition to the new system is as smooth and inclusive as possible for our stakeholders.”
What is the Transparency Regulation?
The regulation was developed in response to a European Citizens’ Initiative on pesticides and the findings of the review of the General Food Law Regulation that was completed in January 2018.
Among other things, the new regulation:

Allows citizens access to scientific studies and information submitted to EFSA by industry early in the process of risk assessment.

Embeds public consultations in the process for assessing applications for approval of regulated products.

Ensures that EFSA is notified of all commissioned studies in a particular area to guarantee that companies applying for authorisations submit all relevant information.

Gives the European Commission the option of asking EFSA to procure additional studies.

Further down the line, the regulation will also transform the way EFSA is governed by adding Member State representatives to its Management Board. Work is also under way to make assessment and management of risks in the food chain more accessible to EU citizens by improving communication and engagement tools and practices.
Compliments of the European Food Safety Authority.
The post Transparency in risk assessment: a new era begins first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Today, the Commission presented an Action Plan for the development of organic production. Its overall aim is to boost the production and consumption of organic products, to reach 25% of agricultural land under organic farming by 2030, as well as to increase organic aquaculture significantly.
Organic production comes with a number of important benefits: organic fields have around 30% more biodiversity, organically farmed animals enjoy a higher degree of animal welfare and take less antibiotics, organic farmers have higher incomes and are more resilient, and consumers know exactly what they are getting thanks to the EU organic logo. The Action Plan is in line with the European Green Deal and the Farm to Fork and Biodiversity Strategies.
The Action Plan is designed to provide the already fast growing organic sector the right tools to achieve the 25% target. It puts forward 23 actions structured around 3 axes – boosting consumption, increasing production, and further improving the sustainability of the sector – to ensure a balanced growth of the sector.
The Commission encourages Member States to develop national organic action plans to increase their national share of organic farming. There are significant differences between Member States regarding the share of agricultural land currently under organic farming, ranging from 0.5% to over 25%. The national organic action plans will complement the national CAP strategic plans, by setting out measures that go beyond agriculture and what is offered under the CAP.
Promote consumption
Growing consumption of organic products will be crucial to encourage farmers to convert to organic farming and thus increase their profitability and resilience. To this end, the Action Plan puts forward several concrete actions aimed at boosting demand, maintaining consumer trust and bringing organic food closer to citizens. This includes: informing and communicating about organic production, promoting the consumption of organic products, stimulating a greater use of organics in public canteens through public procurement and increasing the distribution of organic products under the EU school scheme. Actions also aim, for example, at preventing fraud, increasing consumers’ trust and improving traceability of organic products. The private sector can also play a significant role by, for example, rewarding employees with ‘bio-cheques’ they can use to purchase organic food.
Increase production
Presently, about 8.5% of EU’s agricultural area is farmed organically, and the trends show that with the present growth rate, the EU will reach 15-18% by 2030. This Action Plan provides the toolkit to make an extra push and reach 25%. While the Action Plan largely focuses on the “pull effect” of the demand side, the Common Agricultural Policy will remain a key tool for supporting the conversion. Currently, around 1.8% (€7.5 billion) of CAP is used to support organic farming. The future CAP will include eco-schemes which will be backed by a budget of €38 – 58 billion, for the period 2023 – 2027, depending on the outcome of the CAP negotiations. The eco-schemes can be deployed to boost organic farming.
Beyond the CAP, key tools include organisation of information events and networking for sharing best practices, certification for groups of farmers rather than for individuals, research and innovation, use of blockchain and other technologies to improve traceability increasing market transparency, reinforcing local and small-scale processing, supporting the organisation of the food chain and improving animal nutrition.
To raise awareness on organic production, the Commission will organise an annual EU ‘Organic day’ as well as awards in the organic food chain, to recognise excellence at all steps of the organic food chain. The Commission will also encourage the development of organic tourism networks through ‘biodistricts’. ‘Biodistricts’ are areas where farmers, citizens, tourist operators, associations and public authorities work together towards the sustainable management of local resources, based on organic principles and practices.
The Action Plan also notes that organic aquaculture production remains a relatively new sector but has a significant potential for growth. The upcoming new EU guidelines on the sustainable development of EU aquaculture, will encourage Member States and stakeholders to support the increase in organic production in this sector.
Improve sustainability
Finally, it also aims to further improve organic farming’s performance in terms of sustainability. To achieve this, actions will focus on improving animal welfare, ensuring the availability of organic seeds, reducing the sector’s carbon footprint, and minimising the use of plastics, water and energy.
The Commission also intends to increase the share of research and innovation (R&I) and dedicate at least 30% of the budget for research and innovation actions in the field of agriculture, forestry and rural areas to topics specific to or relevant for the organic sector.
The Commission will closely monitor progress through a yearly follow-up with representatives of the European Parliament, Member States and stakeholders, through bi-annual progress reports and a mid-term review.
Members of the College said
Executive Vice-President for the European Green Deal, Frans Timmermans, said: “Agriculture is one of the main drivers of biodiversity loss, and biodiversity loss is a major threat to agriculture. We urgently need to restore balance in our relationship with nature. This is not something farmers face alone, it involves the whole food chain. With this Action Plan, we aim to boost demand for organic farming, help consumers make informed choices, and support European farmers in their transition. The more land we dedicate to organic farming, the better the protection of biodiversity in that land and in surrounding areas.”
Agriculture Commissioner, Janusz Wojciechowski, said: “The organic sector is recognised for its sustainable practices and use of resources, giving its central role in achieving the Green Deal objectives. To achieve the 25% of organic farming target, we need to ensure that demand drives the growth of the sector while taking into account the significant differences between each Member State’s organic sectors. The organic Action Plan provides tools and ideas to accompany a balanced growth of the sector. The development will be supported by the Common Agricultural Policy, research and innovation as well as close cooperation with key actors at EU, national and local level.”
Commissioner for Environment, Oceans and Fisheries, Virginijus Sinkevičius, said: “Organic farming provides many benefits to the environment, contributing to healthy soils, reducing pollution of air and water, and improving biodiversity. At the same time, with demand growing faster than production over the last decade, the organic sector brings economic benefits to its players. The new Organic farming Action Plan will be a crucial instrument to set the path to achieve the targets of 25% of agricultural area under organic farming and of significant increase of organic aquaculture enshrined in the Biodiversity and the Farm to Fork Strategies. In addition to that, the new Strategic Guidelines for the sustainable development of EU aquaculture to be adopted by the Commission soon, will promote organic aquaculture further.”
Background
The Action Plan takes into account the results of the public consultation held between September and November 2020, which attracted a total of 840 replies from stakeholders and citizens.
It is an initiative announced in the Farm to Fork and Biodiversity strategies, published in May 2020. These two strategies were presented in the context of the European Green Deal to enable the transition to sustainable food systems and to tackle the key drivers of biodiversity loss.
In the recommendations to Member States on their CAP strategic plans published in December 2020, the Commission included the target of a 25% organic area in the EU by 2030. Member States are invited to set national values for this target in their CAP plans. Based on their local conditions and needs, Member States will then explain how they plan to achieve this target using CAP instruments.
The Commission presented its proposals for the CAP reform in 2018, introducing a more flexible, performance and results-based approach that takes into account local conditions and needs, while increasing EU level ambitions in terms of sustainability. The new CAP is built around nine objectives, which is also the basis upon which EU countries design their CAP strategic plans.
Compliments of the European Commission.
The post European Green Deal: EU Commission presents actions to boost organic production first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Creating an emergency Rapid Response Forum to ensure global supplies of essential goods continue to flow during major international crises is one of a broad range of recommendations contained in a new OECD report to the G7 on building economic resilience.
Fostering Economic Resilience in a World of Open and Integrated Markets says the devastating impacts of the Global Financial Crisis and now the COVID-19 pandemic will continue to leave lasting scars on our economies and societies. With the risk of other systemic threats on the horizon – starting with climate change but also spanning security threats, including cyber attackss – it is critical to learn the lessons of these and previous crises in order to tackle the vulnerabilities of our economic system, absorb shocks and engineer a swift rebound.
Ensuring the resilience of global supply chains of essential goods is crucial, the report says. An emergency Rapid Response Forum would provide G7 and other governments with a means of upstream policy co-ordination and, particularly, consultation ahead of the imposition of any trade restrictions. Such an initiative could also prepare timely co-operation on logistics, transportation, procurement, planning and communication.
Commissioned by the UK government, which is currently holding the G7 presidency, the OECD report underlines the need for governments to co-operate both with the private sector through, for instance, supply chain stress tests and emergency planning, and with other countries to boost transparency, discipline export restrictions and adhere to international regulation and standards.
The report says the COVID-19 crisis has caused a huge surge in demand for certain goods, notably in the health and information technology sectors but argues that global supply chains have been part of the solution. After shortages of masks and personal protective equipment, in particular at the beginning of the pandemic, both global production and trade of facemasks later increased tenfold to meet demand.
Strategies based around a reliance on domestic production are unlikely to ensure supply of essential goods and can remove important risk management options such as the diversification of sourcing, the report says. Although temporary scale-up of domestic production for essential goods could be explored as a risk management strategy, reliance on domestic production is not cost-effective nor feasible for strained health budgets, especially for lower income countries, which are almost entirely dependent on global markets to source medical products related to COVID-19. Global supply can allow products to be sourced from the most efficient and cost-effective supplier and enable access to more and different varieties of medical products, ensuring that future surges in global demand are fully met.
Presenting the report alongside Lord Sedwill, chair of the G7 Panel on Economic Resilience, OECD Secretary-General Angel Gurría said: “As we have seen in the past decade alone, in today’s interconnected world, shock events can quickly cascade across borders and economic sectors, and have devastating effects on people’s lives, jobs and opportunities, and on their trust in governments, institutions and markets.”
“Building economic resilience in the face of future shocks is a global challenge for the post-COVID world. For global markets and supply chains to serve as a source of resilience, governments and the public need to have the confidence that markets are and will remain open and fair, including during times of stress.”
Lord Sedwill said: “The unprecedented impact of the covid pandemic on the global economy has highlighted issues of resilience, arising from the growth of monopolies, geopolitical trade tensions, global economic governance falling behind innovation and technology, and the supply of the critical elements essential to the future economy. In response, we should renew our common purpose and commitment to open, well-regulated global markets which promote the green transition, inclusive growth and economic resilience as we build back better.”
The report looks at how to build resilience in global markets, including by reducing distortions and promoting a level playing field for competition, trade and investment. Ensuring global markets are reliable and predictable includes ensuring access to critical raw materials. This calls for enhanced co-operation to develop international agreements for stronger monitoring, notification and disciplines on export restrictions on critical raw materials, promoting responsible sourcing and increasing circularity in this sector. Tackling harmful practices that undermine trust such as foreign bribery is also key.
The OECD proposes governments revise their risk management policies and frameworks to ensure a systemic all-hazards-and-threats approach to resilience with international co-operation playing a central role. This could be supported by a comprehensive evaluation of the lessons learnt from the COVID-19 crisis, including benchmarking and comparison of national preparedness responses.
The OECD says emerging technologies, particularly digitalisation, can contribute to boosting resilience through prevention, absorption and recovery capabilities but can also pose threats. Among its recommendations, the report says governments could strengthen the responsiveness of innovation systems to global policy challenges, reconsidering the way they are organised, structured and financed. It also proposes linking support for innovation more closely to broader public policy objectives and improving international collaboration on emerging technology governance, including by moving towards smarter and more agile regulation.
Contact:

The OECD Media Office | news.contact@oecd.org | tel. +33 1 4524 9700

Compliments of the OECD.
The post OECD reports to G7 on need to strengthen economic resilience against crises first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Today, the European Commission has introduced the principles of reciprocity and proportionality as new criteria to be considered for authorising exports under the transparency and authorisation mechanism for COVID-19 vaccine exports. This system has significantly improved the transparency of exports. Nevertheless, the objective to ensure timely access to COVID-19 vaccines for EU citizens is still not met.
President of the European Commission, Ursula von der Leyen, said: “The EU is proud to be the home of vaccine producers who not only deliver to EU citizens but export across the globe. While our Member States are facing the third wave of the pandemic and not every company is delivering on its contract, the EU is the only major OECD producer that continues to export vaccines at large scale to dozens of countries. But open roads should run in both directions. This is why the European Commission will introduce the principles of reciprocity and proportionality into the EU’s existing authorisation mechanism. The EU has an excellent portfolio of different vaccines and we have secured more than enough doses for the entire population. But we have to ensure timely and sufficient vaccine deliveries to EU citizens. Every day counts.”
Towards increased transparency, reciprocity and proportionality
The new regulation introduces two changes to the existing mechanism. First, in addition to the impact of a planned export to the fulfilment of the EU’s Advance Purchase Agreements (APAs) with vaccine manufacturers, Member States and the Commission should also consider:

Reciprocity – does the destination country restrict its own exports of vaccines or their raw materials, either by law or other means? and

Proportionality – are the conditions prevailing in the destination country better or worse than the EU’s, in particular its epidemiological situation, its vaccination rate and its access to vaccines.

Member States and the Commission should assess whether the requested exports do not pose a threat to the security of supply of vaccines and their components in the Union.
Second, to gain a full picture of vaccine trade, the new act includes 17 countries previously exempted in the scope of the regulation.*
The EU remains committed to international solidarity and will therefore continue to exclude from this scheme vaccine supplies for humanitarian aid or destined to the 92 low and middle income countries under the COVAX Advance Market Commitment list.
The export authorisation scheme
This implementing act is targeted, proportionate, transparent and temporary. It is fully consistent with the EU’s international commitment under the World Trade Organization and the G20, and in line with what the EU has proposed in the context of the WTO’s trade and health initiative. Member States decide on the requests for authorisation in accordance with the Commission’s opinion.
Since the start of this mechanism, 380 export requests to 33 different destinations have been granted for a total of around 43 million doses. Only one export request was not granted. The main export destinations include the United Kingdom (with approximately 10.9 million doses), Canada (6.6 million), Japan (5.4 million), Mexico (4.4 million), Saudi Arabia (1.5 million), Singapore (1.5 million), Chile (1.5 million), Hong Kong (1.3 million), Korea (1.0 million) and Australia (1.0 million).
About the EU’s vaccine strategy
The European Commission presented on 17 June 2020 a European strategy to accelerate the development, manufacturing and deployment of effective and safe vaccines against COVID-19. In return for the right to buy a specified number of vaccine doses in a given timeframe, the Commission finances part of the upfront costs faced by vaccines producers in the form of Advance Purchase Agreements (APAs). Funding provided is considered as a down-payment on the vaccines that are actually purchased by Member States. The APA is therefore a de-risk investment upfront against a binding commitment from the company to pre-produce, even before it gets marketing authorisation. This should allow for a quick and steady delivery as soon as the authorisation has been granted.
The Commission has so far signed APAs with six companies (AstraZeneca, Sanofi-GSK, Janssen Pharmaceutica NV, BioNTech-Pfizer, CureVac, and Moderna), securing access to up to 2.6 billion doses. Negotiations are advanced with two additional companies. The four contracts with the companies whose vaccines have been granted conditional marketing authorisation amount to more than 1.6 billion doses.
Compliments of the European Commission.
The post EU Commission strengthens transparency and authorisation mechanism for exports of COVID-19 vaccines first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

For technology to benefit everyone, private sector innovation needs to be supported by public goods
Digital technology is transforming the financial industry, changing the way payments, savings, borrowing, and investment services are provided and who provides them. Fintech and Big Tech companies now compete with banks and other incumbents across a range of markets. Meanwhile, digital currencies promise to transform the heart of finance: money itself.
But just how much has technology advanced financial inclusion? For sure, in the past year alone, digital finance has helped households and businesses meet the challenges posed by the COVID-19 pandemic. It has also given governments new ways of reaching those who need support.
Progress to date has been impressive. Yet if it is to realize its full potential in bolstering financial inclusion, private sector innovation must be supported by the appropriate public goods, as innovation has large spillovers to all aspects of economic activity. Public goods provide the underpinnings of financial inclusion.
Disruptive inclusion?
Financial inclusion can be understood as universal access to, and use of, a wide range of reasonably priced financial services. Inclusion made great strides in the decade between the global financial crisis and the pandemic. Despite a volatile global economy, World Bank data show that 1.2 billion adults gained access to a transaction account between 2011 and 2017. Much of this progress came directly from new digital technologies.
‘As COVID-19 imposed social distancing and lockdowns, digital payments became a lifeline for many people.’
Mobile money is a case in point. Kenya’s M-Pesa and similar applications let users send and receive payments on all mobile phones. Over time, providers have broadened their services, offering microloans, savings accounts, and insurance against crop failures and other hazards. As of 2019, 79 percent of Kenyan adults had a mobile money account. Usage is rising fast across Africa, the Middle East, and Latin America.
In China, Ant Group and Tencent have reached a respective 1.3 billion and 900 million users with Alipay and WeChat Pay. Payment applications, based on mobile interfaces and quick response (QR) codes, have paved the way for a whole spectrum of financial services, ranging from small loans and money market funds to “mutual aid,” a form of health insurance.
In India, public provision of foundational infrastructure has been the main driver, with a far-reaching impact. The digital identity (ID) initiative Aadhaar (Hindi for “foundation” or “base”) has given 1.3 billion people access to a trusted ID so that they can open a bank account and access other services. Building on the initiative, a new system lets users make low-cost payments in real time. As Bank for International Settlements (BIS) research shows (D’Silva and others 2019), India has increased bank account access from 10 percent of the population in 2008 to more than 80 percent today. Technology achieved in a decade what might have taken half a century with traditional growth processes.
As COVID-19 imposed social distancing and lockdowns, digital payments became a lifeline for many people. Small businesses were able to continue accepting payments, and individuals could send money to their loved ones quickly and at low cost. While not everyone was able to access digital payments and financial services, technology helped fill the gaps. In the Philippines, 4 million digital accounts were opened remotely between mid-March and the end of April 2020.
Governments worldwide used new digital infrastructure to reach households and informal workers. In Peru, payments were made through Billetera Móvil, a project that fully integrated the country’s largest mobile operators and banks. In Thailand, the government’s PromptPay fast payment system fulfilled the same purpose. This success stood in sharp contrast to the practice in some advanced economies, such as the United States, of sending paper checks through the mail.
The economics of digital innovation
Although the pandemic will leave major economic damage and inequality in its wake, it will help drive the adoption of digital technologies that enable financial inclusion and economic opportunity. But these technologies will not succeed on their own. To understand how digital technology and policies can help, it is helpful to look first at the underlying economics.
At the heart of digital innovations stand a few technological enablers. First are mobile phones and the internet, connecting individuals and businesses with information and providers of financial services. A second enabler is the storage and processing of large volumes of digital data. Finally, advances like cloud computing, machine learning, distributed ledger technology, and biometric technologies play a role.
But at the core of all these innovations is the ability to gather information and reach users at a very low cost. Economists have assessed the range of specific costs that decrease with digital technologies (Goldfarb and Tucker 2019). Two economic features of digital technology help show why these factors have been so powerful and what risks they pose.
First, digital platforms are highly scalable. Platforms can be thought of as “matchmakers” that help different groups of users find one another. For instance, a digital wallet provider like PayPal brings together merchants and clients who want to make secure payments. The more clients use a particular payment option, the more attractive it is for merchants to accept it, and vice versa. This is an example of economies of scale, which allow providers to grow quickly.
Similarly, Big Techs such as Amazon or China’s Alibaba can serve as matchmakers to help buyers and sellers of goods find one another, but they can also link merchants with providers of credit and other services. Because of the range of services provided (including nonfinancial), they have information that can be very valuable for their financial offerings. This exemplifies economies of scope, which give the advantage to providers with multiple business lines.
Second, digital technologies can improve risk assessment, benefiting from the same data that are the natural by-product of their business. This is particularly relevant for services such as lending, as well as investment and insurance. Credit scores based on big data and machine learning can often outperform traditional assessments, particularly for “thin-file” borrowers, people or small businesses with little or no formal documentation.
Research by BIS economists and coauthors shows that almost a third of borrowers served by Mercado Libre, a Big Tech lender in Argentina, would have been unable to access credit from a traditional bank (Frost and others 2019). Moreover, firms that borrowed from Mercado Libre enjoyed greater sales and product offerings in the year after they borrowed. Research with data from Ant Group suggests that, by relying on big data, Big Tech lenders have less need for collateral (Gambacorta and others 2019). This can open up access to lending for borrowers who have no house or other assets to offer as collateral, and make loans less sensitive to asset price changes.
Such economies of scale and scope, together with improvements in predictive power, can drive financial inclusion forward by leaps and bounds. Indeed, Big Tech credit has boomed worldwide in the past decade, rising to an estimated $572 billion in 2019 (see Chart 1). Such lending is particularly important in China, Kenya, and Indonesia, compared with traditional credit markets. It is also growing rapidly elsewhere and may even have ticked up during the pandemic as some Big Techs helped distribute government lending to companies.

However, every silver lining has a cloud, and the advances made possible by big data have drawbacks—in particular, the tendency toward monopolies. In some economies, Big Tech payment providers and lenders have become systemically important (“too big to fail”). The tendency to buy up competitors may choke off innovation. Finally, there is a serious risk that sensitive data will be misused and privacy violated. Smart public policies are needed to mitigate these risks, while allowing the potential of digital technologies to be fulfilled.
Closing the gaps with smart policy
How should policymakers adapt to this brave new world? How can they reap the benefits of digital innovation for financial inclusion, while mitigating the (very real) risks to financial stability and consumer rights? Five sets of policies are needed.
Building inclusive digital infrastructures: Initiatives such as India’s Aadhaar digital ID are a stepping-stone to accounts and more sophisticated services. Fast retail payment systems based on open public infrastructure that ensure a level playing field are essential. Examples include the Faster Payments System in Russia, CoDi in Mexico, and PIX in Brazil—these facilitate instantaneous and low- or zero-cost digital payments between individuals and businesses or governments. Central bank digital currencies, now being tested in China and other countries and already operational in The Bahamas, can play a similar role as a common platform on which private providers can build services.
Introducing common standards to bolster competition: Many countries have countered digital monopolies with standards that let users carry their data across various platforms. This makes different providers “interoperable,” supporting consumer choice and competition. Much like the basic protocols at the heart of the internet, these common standards are a critical public good that allows private markets to flourish.
Updating competition policies: In the digital age, traditional measures of competition in markets, and traditional antitrust tools, may no longer be adequate. For instance, monopoly behavior may manifest itself through capture of data rather than high prices. Without regulatory intervention, markets may see new barriers to entry and new anticompetitive practices. As the growing scrutiny of mergers and acquisitions and of digital gatekeepers shows, there may be a need for new and more forward-thinking ways of keeping digital finance markets competitive and contestable.
Strengthening data privacy: Laws on data generated by digital services are often not well-defined, meaning that tech companies have de facto control over sensitive data. Users must be given more control and agency. Privacy laws enacted in the European Union and practices regarding user control of data embedded in India Stack offer potential models. Recent research finds that men are generally more willing than women to share their data in exchange for better financial services offers (Chen and others, forthcoming) (see Chart 2). Younger users are also more open to sharing than older users. Defining rules for data use that fit all of society will be a challenge—and will likely require legislation.

Getting policymakers of all stripes to work together: Digital technologies in finance concern not only central banks and regulators but also those in charge of competition and data protection. Central banks and financial regulators must work hand in hand with competition authorities and data privacy authorities. Moreover, policies in one country are very likely to affect users in other countries. By coordinating their policies within and across borders, authorities can work to harness the benefits of digital technology and ensure that these accrue to all.
‘Central banks and financial regulators must work hand in hand with competition and data privacy authorities.’
If public goods are appropriately designed, and if policymakers cooperate, digital technology can be harnessed to bring more people—particularly the poorest—into the financial system. Broad diffusion of technology may help make societies not only more efficient, but more equitable and better prepared for the digital future. Innovation must be shaped to benefit everyone.
Authors:

Jon Frost, Senior Economist, BIS

Leonardo Gambacorta, Head of the Innovation and Digital Economy Unit, BIS

Hyun Song Shin, Economic Adviser & Head of Research, BIS

Compliments of the IMF Finance & Development.
The post IMF | From Financial Innovation to Inclusion first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The EU Commission has published its first preliminary assessment of the impact of SURE, the €100 billion instrument designed to protect jobs and incomes affected by the COVID-19 pandemic.
The report finds that SURE has been successful in cushioning the severe socio-economic impact resulting from the COVID-19 crisis. It has helped to ensure that the increase in unemployment in the beneficiary Member States during the crisis has been significantly smaller than during the global financial crisis, despite them experiencing a larger decrease in GDP.
SURE is a crucial element of the EU’s comprehensive strategy to protect citizens and mitigate the severely negative socio-economic consequences of the COVID-19 pandemic. It provides financial support in the form of loans granted on favourable terms from the EU to Member States to finance national short-time work schemes, and other similar measures to preserve employment and support incomes, notably for the self-employed, and some health-related measures. The Commission has so far proposed a total of €90.6 billion in financial support to 19 Member States. SURE can still make over €9 billion of financial assistance available and Member States can still submit requests for support. The Commission stands ready to assess additional top-up requests from Member States in response to the resurgence of COVID-19 infections and new restrictions.
Main findings
The Commission’s report has found that the instrument supported between 25 and 30 million people in 2020. This represents around one quarter of the total number of people employed in the 18 beneficiary Member States.
It also estimates that between 1.5 and 2.5 million firms affected by the COVID-19 pandemic have benefitted from SURE, allowing them to retain workers.
Member States have saved an estimated €5.8 billion in interest payments by using SURE, compared to if they had issued sovereign debt themselves, thanks to the EU’s high credit rating. Future disbursements will likely generate further savings.
Feedback from beneficiaries shows that SURE support played an important role in the creation of their short-time work schemes, and in increasing their coverage and volume.
Today’s report also covers the borrowing and lending operations to finance SURE. It finds that demand from Member States for the instrument has been strong, with more than 90% of the total €100 billion envelope available under SURE already allocated. Interest from investors in SURE bonds has been similarly robust. By the cut-off date of the report, the Commission raised €53.5 billion in the first four issuances, which were on average more than ten times over-subscribed. All funds have been raised as social bonds, giving investors confidence that their money goes towards measures with a real social purpose, sustaining families’ incomes at a time of crisis. The EU’s ability to raise money for SURE was supported by a €25 billion guarantee from all Member States, a strong signal of European solidarity.
Members of the College said:
Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People said: “The SURE initiative has proven its value by keeping people in jobs and businesses afloat during the crisis. Designed as one of three safety nets to tackle the short-term consequences of the crisis, SURE has successfully supported tens of millions of people and firms across the EU, protecting against the risk of unemployment and safeguarding livelihoods. As we move towards the recovery, we will continue with measures to support a job-rich recovery and provide active support for workers and labour markets.”
Johannes Hahn, Commissioner for Budget and Administration, said: “For the first time in history, the Commission has issued social bonds on the markets, to raise money that has contributed to keeping people in jobs during the crisis. As the report on the temporary Support to mitigate Unemployment Risks in an Emergency (SURE) demonstrates, the positive impact for companies and their employees is concrete and tangible.”
Nicolas Schmit, Commissioner for Jobs and Social Rights, said: “Today’s report confirms that SURE has been successful in protecting jobs and incomes from what could have been an even greater shock during the pandemic. SURE has been adopted and implemented in a very short time allowing Member States to react swiftly to the crisis. Millions of workers as well as companies and also the self-employed have benefited from this innovative instrument. The different short-time work models Member States put into place with the financial support of SURE have also preserved skills in companies which will be needed for a strong recovery.”
Paolo Gentiloni, Commissioner for Economy said: “The SURE programme has played a crucial role in protecting workers and the self-employed from the worst effects of the economic shock caused by the pandemic. Today’s report indicates that up to 30 million people and as many as 2.5 million firms in 18 EU countries have benefited from this groundbreaking European scheme. And Member States have saved an estimated €5.8 billion by borrowing this money from the EU rather than on the markets. As we look forward to the roll-out of the Recovery and Resilience Facility, SURE offers an encouraging example of what European solidarity can deliver for our citizens.”
Background
The Commission proposed the SURE Regulation on 2 April 2020, as part of the EU’s initial response to the pandemic. It was adopted by the Council on 19 May 2020 as a strong sign of European solidarity, and became available after all Member States signed the guarantee agreements on 22 September 2020. The first disbursement took place five weeks after SURE became available.
Today’s report is the first bi-annual report on SURE addressed to the Council, the European Parliament, the Economic and Financial Committee (EFC) and the Employment Committee (EMCO). Under Article 14 of the SURE Regulation, the Commission is legally required to issue such a report within 6 months of the day that the instrument became available. Subsequent reports will follow every six months for as long as SURE remains available.
Beyond the 18 Member States discussed in the report, the Commission has since proposed granting financial assistance to a 19th Member State, Estonia, for an amount of €230 million. In addition, the Commission has also raised an additional €9 billion of SURE bonds since the report’s cut-off date. A full overview of the funds raised under each issuance and the beneficiary Member States is available online here.
On 4 March, the Commission presented a Recommendation on Effective Active Support to Employment following the COVID-19 crisis (EASE). It outlines a strategic approach to gradually transition between emergency measures taken to preserve jobs during the pandemic and new measures needed for a job-rich recovery. With EASE, the Commission promotes job creation and job-to-job transitions, including towards the digital and green sectors. Its three policy recommendations consist of hiring incentives and entrepreneurial support; upskilling and reskilling opportunities; and enhanced support by employment services.
Compliments of the European Commission.
The post Report confirms SURE’s success in protecting jobs and incomes first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

1. Introduction
A phenomenon referred to as the “paradox of banknotes”[1] has been observed in the euro area; in recent years, the demand for euro banknotes has constantly increased while the use of banknotes for retail transactions seems to have decreased. Recent payment surveys indicate that the share of cash transactions in the euro area has decreased. This, together with ongoing digitalisation in retail payments, might have been expected to lead to a decrease in the demand for cash.[2] However, this reduction in demand has not occurred. In fact, the number of euro banknotes in circulation has increased since 2007 (see Chart 1). This seemingly counterintuitive paradox can be explained by demand for banknotes as a store of value in the euro area (e.g. euro area citizens holding cash savings) coupled with demand for euro banknotes outside the euro area. This article will use the available evidence to explain this phenomenon in more detail.
CONTINUE READING HERE
Author:

Alejandro Zamora-Pérez

Compliments of the European Central Bank.
The post ECB | The paradox of banknotes: understanding the demand for cash beyond transactional use first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Today, the Council of the OECD composed of Ambassadors representing the 37 Member Countries, took the formal decision to appoint Mr. Mathias Cormann of Australia to become the sixth Secretary-General of the Organisation, for a 5 year-term beginning on 1 June 2021.
Member countries took this decision following the conclusion of the seven-month Selection Process led by the Dean of the Council, and chair of the Selection Committee, Ambassador Christopher Sharrock of the United Kingdom, that began in August 2020. In the final report to his fellow Ambassadors issued last Friday, the Dean informed them that he had been able to identify Mr Cormann as the candidate with most support.
Mr. Cormann will take up his duties on 1 June, the day after Secretary-General Angel Gurria’s final term concludes 15 years at the helm of the Organisation. This will coincide with the first of two sessions of the Annual OECD Ministerial Council Meeting to be held on 31 May – 1 June.
Mr. Cormann will become the first Secretary General to emerge from the Asia Pacific region.
All relevant background Information is available here:

Biography of the SG-Select

Vision Statement of the SG-Select
Details of the OECD Secretary-General Selection Process

A list of former OECD Secretaries-General

The OECD’s 60-year History

About the OECD

Compliments of the OECD.
The post The 37 Member Countries of OECD appoint Mr. Mathias Cormann of Australia to be next Secretary General starting 1 June 2021 first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Compounded €STR average rates and compounded index based on €STR to be published as of 15 April 2021
Average rates to cover 1-week, 1-month, 3-month, 6-month and 12-month tenors
Publication via ECB’s Market Information Dissemination (MID) platform and Statistical Data Warehouse

The European Central Bank (ECB) will start publishing compounded €STR average rates and a compounded index based on the euro short-term rate (€STR) on 15 April 2021. Publication will take place on each TARGET2 business day at 09:15 CET and will include compounded €STR average rates for tenors of 1 week, 1 month, 3 months, 6 months and 12 months, as well as a compounded €STR index enabling the derivation of compounded rates for any non-standard tenor. The ECB is responding to market feedback in favour of having compounded rates based on the €STR published regularly by a trusted authority.
The rules for the calculation and publication of the compounded €STR average rates and index were published on the ECB’s website today and take into account the outcome of the public consultation on the design of the rates and index. The ECB would like to thank all those who responded to this public consultation.
The compounded €STR average rates and index will be published via the Market Information Dissemination (MID) platform and through the ECB’s Statistical Data Warehouse (SDW).
The ECB Guideline (ECB/2019/19) on the governance of the €STR and on the administration and oversight of the €STR determination process has been amended to cover the calculation and publication of the compounded €STR average rates and index.
More information about the €STR can be found on the ECB’s website.
Contact:

William Lelieveldt | william.lelieveldt[at]ecb.europa.eu

Compliments of the European Central Bank.
The post ECB starts publishing compounded euro short-term rate (€STR) average rates on 15 April 2021 first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The European Commission launched today, at an online event, the European Innovation Council (EIC) with a budget of over €10 billion (in current prices) for 2021-2027 to develop and expand breakthrough innovations. Building on a successful pilot programme under Horizon 2020, the new EIC is not only a novelty of Horizon Europe, but it is also unique in the world: it combines research on emerging technologies with an accelerator programme and a dedicated equity fund, the European Innovation Council Fund, to scale up innovative start-ups and small and medium-sized businesses (SMEs). Around €3 billion of the EIC’s budget will go towards the EIC Fund.
Furthermore, the first annual work programme of the EIC is published, opening funding opportunities worth over €1.5 billion in 2021. At the same time, two prizes for Women Innovators and the European Capital of Innovation are opened for applications.
Margrethe Vestager, Executive Vice-President for ‘A Europe Fit for the Digital Age’, said: “We now have a fund to support small and medium sized companies that do breakthrough innovation, access equity and scale up innovative start-ups. This is a way to convert research results into business and to develop visions for technological and innovation breakthroughs.”
Mariya Gabriel, Commissioner for Innovation, Research, Culture, Education and Youth, said: “The European Innovation Council is Europe’s most ambitious initiative to support the breakthroughs Europe needs to recover from the economic crisis and accelerate the transition to a green and digital economy. By investing in visionary research and innovative companies, it will reinforce European technological sovereignty, scale up hundreds of Europe’s most promising start-ups, and pave the way for the upcoming European Innovation Area.”
The European Innovation Council capitalises on lessons learnt and achievements from its pilot phase during the period 2018-2021. It supported over 5000 SMEs and start-ups, as well as over 330 research projects with a budget of €3.5 billion.
Key novelties of the European Innovation Council
The European Innovation Council (EIC) has several features that make it unique in its way of supporting pioneering ventures and projects.

The EIC Accelerator supports SMEs, in particular start-ups and spinout companies to develop and scale up game-changing innovations. The EIC Accelerator features a new innovator friendly application system, where start-ups and SMEs can apply for funding at any time via a simplified process.
A team of EIC Programme Managers will be responsible for developing visions for technological and innovation breakthroughs (such as cell and gene therapy, green hydrogen, and tools to treat brain disease), managing portfolios of EIC projects and bringing together stakeholders to put these visions into reality.
A new EIC Transition funding scheme will help convert research results (from the EIC Pathfinder and the European Research Council) into innovations (spinouts, commercial partnerships, etc.).
New measures are introduced to support women innovators, which include a female leadership programme. In partnership with the Enterprise Europe Network, talented female innovators, as well as all innovative SMEs from lesser-known regions, will be supported to apply, helping to overcome the innovation divide.

Composed of leading innovators, the EIC Advisory Board delivers the strategy of the European Innovation Council and provides advice on its implementation (see today’s statement of the EIC Advisory Board).
Funding opportunities in 2021
The funding opportunities announced today in the first work programme of the European Innovation Council include:

EIC Accelerator financing, worth €1 billion, for start-ups and SMEs to develop and scale up high impact innovations with the potential to create new markets or disrupt existing ones. It provides a unique blended finance combining equity (or quasi-equity such as convertible loans) between €0.5 million and €15 million through the EIC Fund, with grants of up to €2.5 million. Out of the €1 billion, €495 million is earmarked for breakthrough innovations for the European Green Deal and for strategic Digital and Health Technologies.

EIC Pathfinder for multi-disciplinary research teams, worth €300 million, to undertake visionary research with the potential to lead to technology breakthroughs. Research teams can apply for up to €4 million in grants. The bulk of the funding is awarded through open calls with no predefined thematic priorities, while €132 million is allocated to tackle five Pathfinder challenges: self-aware Artificial Intelligence (AI), tools to measure brain activity, cell and gene therapy, green hydrogen, and engineered living materials.

EIC Transition funding to turn research results into innovation opportunities, worth €100 million. This first EIC Transition call will focus on results generated by EIC Pathfinder pilot projects and European Research Council Proof of Concept projects, to mature the technologies and build a business case for specific applications.

All projects of the European Innovation Council have access to Business Acceleration Services, which provide coaches, mentors and expertise, partnering opportunities with corporates, investors and others, and a range of services and events.
European Innovation Council prizes
Several prizes are integrated in the European Innovation Council to celebrate those shaping the future of innovation in Europe.

The EU Prize for Women Innovators recognises the most talented women entrepreneurs from across the EU and countries associated to Horizon Europe, who have founded a successful company and brought innovation to market.
The European Capital of Innovation Awards (iCapital) recognises the role cities play to shape local innovation ecosystem and promote game-changing innovation. This year includes a new category The European Rising Innovative City that targets towns and cities with a population of more than 50,000 and less than 250,000 inhabitants.
The European Social Innovation Competition aims to incentivise, support and reward social innovations that will help people and organisations to identify, develop and strengthen the skills they will need to adapt and thrive in a changing world.

The European Innovation Procurement Awards aim to recognise public and private buyers across Europe in their efforts to promote innovation procurement and the innovative ways the solutions are procured.

The EU Prize for Women Innovators and the European Capital of Innovation Awards are open for applications as of today, while the other two will open later this year.
Background
The Commission launched in 2018 the European Innovation Council pilot under Horizon 2020 to support the most talented European innovators in the fast and effective scaling-up of breakthrough, disruptive innovation, with a budget of €3.5 billion. Further information on the European Innovation Council pilot can be found in the Impact Report.
Following today’s launch, an applicants’ day will take place on Friday 19 March to provide information on how the European Innovation Council works, how to apply, and who is eligible. Sessions will include information on funding opportunities for research teams, start-ups, SMEs and investors.
Compliments of the European Commission.
The post EU Commission launches European Innovation Council to help turn scientific ideas into breakthrough innovations first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.