Today, the Council reached an agreement on next year’s fishing opportunities in the Baltic Sea, focusing on fish stock recovery. Ministers agreed to continue decreasing the fishing opportunities for several fish stocks in the Baltic Sea to help them recover. Ministers decided to continue the closure of the Eastern Baltic cod fishery and to provide only a by-catch quota, which was again significantly reduced compared to last year’s. The biggest cuts in the total allowable catches (TACs) were for the herring of the Western and Central part of the Baltic Sea, in line with the latest scientific advice.

This agreement is a viable solution forward for fishermen and fishery resources in the Baltic Sea. It is an agreement that strengthens our efforts to sustain and help stocks recover while ensuring activities for fishermen.
Julia Klöckner, Federal Minister for Food and Agriculture of Germany

Ministers agreed for a moderate increase of the TACs for herring in the Gulf of Riga, Western Baltic cod, plaice, sprat and salmon in the main basin area of the Baltic Sea, while salmon in the Gulf of Finland will be moderately decreased. The TACs for the Bothnian herring will remain at the same level as last year.
The agreement in detail
Based on a Commission proposal, the agreed quantities take into account the commitment to meet the objectives of the Common Fisheries Policy (CFP), including the achievement of Maximum Sustainable Yield (MSY), as well as scientific advice provided in particular by the International Council for the Exploration of the Sea (ICES). The provisions of the multiannual management plan for the Baltic sea were also the guiding principles of this year’s exercise.
In addition to setting TACs and quotas on some species, the Council agreed on additional measures such as:

Maintain the existing summer spawning closure for the Eastern Baltic cod with an exception for purely scientific fisheries and small-scale coastal fisheries using specific gears.
Extend the spawning closure period for cod in Subdivision 24.
Maintain the ban on recreational fisheries of Eastern Baltic cod, and maintain the reduced bag limit for Western Baltic cod recreational fisheries.
Declaration by relevant Member States not to use year-to-year flexibility for Eastern Baltic cod.

Traditionally, this regulation also includes an amendment to the 2020 fishing opportunities to take into account recent advice for Norway pout. The Council therefore also decided on fishing opportunities for this important fishery whose season will start at the beginning of November. Given that this stock is partly present in UK waters, the TAC is currently only set until the end of the year and will need to be revised then.
Preparatory work conducive to finding swift agreement was carried out at regional level through BALTFISH, a body providing a platform for discussion on important fisheries issues in the Baltic Sea, currently under Estonia’s chairmanship.

Council agreement on 2021 catch limits in the Baltic Sea

Next steps
To ensure the entry into force of this regulation by 1 November for Norway pout fishing activities to continue, after finalisation by the legal/linguists experts, this item will be submitted for adoption by written procedure.
Background
Today’s discussions were based on a Commission proposal with article 43(3) of the Treaty on the Functioning of the European Union (TFEU) as the legal basis. Under this article, it is for the Council to adopt measures on the fixing and allocation of fishing opportunities within the framework of the common fisheries policy. The European Parliament’s participation and the Economic and Social Committee’s opinion are therefore not required for the adoption of this regulation.
Compliments of the Council of the European Union.
The post Baltic Sea fishing: Council of the EU agrees on 2021 catch limits first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Today, the Council agreed its negotiating position (general approach) on the post-2020 common agricultural policy (CAP) reform package. This agreed position puts forward some strong commitments from member states for higher environmental ambition with instruments like mandatory eco-schemes (a novelty compared to the current policy) and enhanced conditionality. At the same time, the agreed position allows member states to have the necessary flexibility in how they would reach environmental goals. For instance, there would be a two-year pilot phase for eco-schemes and member states would enjoy flexibility on how to allocate funds under different green practices.
A general approach means that the Council has now the political mandate to kick-off negotiations with the European Parliament, once the co-legislator also agrees on its internal position, with a view to reaching an overall agreement.

Today’s agreement is a milestone for Europe’s agricultural policy. Member states demonstrated their ambition for higher environmental standards in farming and at the same time supported the needed flexibility in ensuring farmers’ competitiveness. This agreement fulfils the aspiration of a greener, fairer and simpler CAP.
Julia Klöckner, Federal Minister for Food and Agriculture of Germany

The reform of the CAP foresees that while more flexibility will be given to member states in shaping rules and funding allocations through the development of national strategic plans, they will be obliged to demonstrate a higher environmental ambition compared to the current period. The so-called “new delivery model” would favour performance over compliance: it would enables countries to choose the best tools and actions at their disposal (and also taking into account national specificities) to reach the agreed EU-wide objectives and standards.
Some concrete examples of member states will fulfil higher environmental standards, which were debated and agreed during the two-day Council, include:

Farmers would receive financial support under the condition that they adopt practices beneficial for the climate and the environment, to make the CAP even greener than before.
Farmers going beyond the basic environment and climate requirements would get additional financial support through the introduction of “eco-schemes”. These new instruments for environment and climate protection would be linked to a dedicated budget, constituting part of the direct payments budget. It would be ring-fenced at 20%, which means that they would be unlocked through the use of eco-schemes. An initial pilot phase of two years would ensure that member states avoid losing much-needed funds while getting acquainted with the new instruments. Indicative examples of eco-schemes include practices like precision farming, agroforestry, and organic farming, but member states would be free to design their own instruments on the basis of their needs.
All farmers would be bound to higher environmental standards; even the smaller ones. To help them in this greening transition, small farmers would be subject to more simplified controls, reducing administrative burden while assuring their contribution to environmental and climate goals.

The Council’s position is a result of negotiations and work conducted over the last two and a half years and under five presidencies.
The European Commission presented the post-2020 CAP reform package in 2018; the package consists of three proposals:

a regulation on CAP strategic plans
a regulation on financing, managing and monitoring of the CAP
a regulation on a common market organisation of agricultural products

Compliments of the Council of the European Union.
The post Council of the EU agrees its position on the next EU common agricultural policy first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The European Commission issued a €17 billion inaugural social bond under the EU SURE instrument to help protect jobs and keep people in work. The issuing consisted of two bonds, with €10 billion due for repayment in October 2030 and €7 billion due for repayment in 2040. There was very strong investor interest in this highly rated instrument, and the bonds were more than 13 times oversubscribed, resulting in favourable pricing terms for both bonds.
President of the European Commission Ursula von der Leyen said: “For the first time in history, the Commission is issuing social bonds on the market, to raise money that will help keep people in jobs. This unprecedented step matches the extraordinary times we are living in. We are sparing no efforts to safeguard livelihoods in Europe. I’m glad that countries hit badly by the crisis will receive support under SURE rapidly.”
European Commissioner Johannes Hahn in charge of Budget and Administration said: “With this operation, the European Commission has made a first step towards entering the major league in global debt capital markets. The strong investor interest and the favourable conditions under which the bond was placed are further proof of the great interest in EU bonds. The “social bond” character of the issuance has helped to attract investors who wish to help EU Member States in supporting employment through these difficult times.”
Both bonds were issued on attractive terms, reflecting the high level of interest. The 10-year bond was priced at 3 basis points above mid-swaps. The 20-year bond was priced at 14 basis points over mid-swaps. The final new issue premiums have been estimated at 1 bps and 2 bps for the 10-year and 20-year tranches respectively, both values being extremely limited given the amounts printed.
These represent attractive pricing conditions for the Commission’s largest ever bond issuance and a favourable debut for the SURE programme. The terms on which the Commission borrows are passed on directly to the Member States receiving the loans. (See here for more details on the pricing of the transaction).
The banks that supported the European Commission with this transaction (“joint bookrunners”) were Barclays (IRL), BNP Paribas, Deutsche Bank, Nomura and UniCredit.
The funds raised will be transferred to the beneficiary Member States in the form of loans to help them cover the costs directly related to the financing of national short-time work schemes and similar measures as a response to the pandemic.
In that context, the Commission announced earlier this month that it would issue the entire EU SURE bond of up to €100 billion as social bonds, and adopted an independently evaluated Social Bond Framework.
Background on SURE
So far, 17 Member States will receive financial support under the SURE instrument to help protect jobs and keep people in work. Financial support will be provided in the form of loans granted on favourable terms from the EU to Member States.
These loans will help Member States to cover the costs directly related to the financing of national short-time work schemes, and other similar measures they have put in place as a response to the pandemic, in particular for the self-employed. SURE could also finance some health-related measures, in particular at the work place, used to ensure a safe return to normal economic activity.
Member States can still submit formal requests for support under SURE, which has an overall firepower of up to €100 billion to help protect jobs and workers affected by the pandemic. The Commission has already proposed a total of €87.8 billion in financial support under SURE to 17 Member States.
Background on the EU borrowing

The EU was established by the Treaty of Rome in 1957 and is 0% risk weighed as an issuer (Basel III). The EU’s borrowings are direct and unconditional obligations of the EU, guaranteed by the EU Member States through the EU budget. The European Commission is empowered by the EU Treaty to borrow on the international capital markets, on behalf of the European Union.
The EU borrows exclusively in Euros for on-lending in Euros to sovereign borrowers. The EU currently operates four loan programmes: The European Financial Stabilisation Mechanism (“EFSM”), the Balance of Payments facility (“BoP”), the Macro-Financial Assistance (“MFA”) and the Support to mitigate Unemployment Risk in an Emergency (SURE), recently adopted by the Council on 19 May 2020.
The bonds issued by the EU under SURE will benefit from a social bond label.

Further details on the issuance:

Ahead of the transaction, the EU sent a Request for Proposal (RfP) to 20 banks on 9 October 2020 informing them of its intention to raise significant amounts in the market.
The formal mandate for a dual tranche issue was announced on Monday, 19 October at 13:25 CET.
Books were opened on Tuesday, 20 October 2020 in the morning at 08:55 CET and closed at 10:00 CET.

Compliments of the European Commission.
The post European Commission issues first emission of EU SURE social bonds first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

To exploit the full potential of contact tracing and warning apps to break the chain of coronavirus infections across borders and save lives, the Commission, at the invitation by EU Member States, has set up an EU-wide system to ensure interoperability – a so-called ‘gateway’. After a successful pilot phase, the system goes live today with the first wave of national apps now linked through this service: Germany’s Corona-Warn-App, Ireland’s COVID tracker, and Italy’s immuni. Together, these apps have been downloaded by around 30 million people, which corresponds to two-thirds of all app downloads in the EU.
Thierry Breton, Commissioner for Single Market, said: “Many Member States have launched voluntary contact tracing and warning apps, and the Commission has supported them in make these apps safely interact with each other. Free movement is an integral part of the Single Market – the gateway is facilitating this while helping save lives.”
Stella Kyriakides, Commissioner for Health and Food Safety, added: “Coronavirus tracing and warning apps can effectively complement other measures like increased testing and manual contact tracing. With cases on the rise again, they can play an important role to help us break the transmission chains. When working across borders these apps are even more powerful tools. Our gateway system going live today is an important step in our work, and I would call on citizens to make use of such apps, to help protecting each other.”
Jens Spahn, Germany’s Federal Minister of Health, said: “Everywhere in Europe, infections are on the rise again. Right now, national warning apps are making a real difference. Because every infection chain that, thanks to an app, is broken more quickly helps to contain the pandemic. With the new gateway service, we are connecting apps across Europe. Like this, contacts can also be warned during or following a trip abroad.”
In the fight against coronavirus, most Member States have decided to launch a contact tracing and warning app. In total, 20 apps which are based on decentralised systems can be interoperable through the gateway service. They can be linked to the gateway after following a protocol that foresees several tests and checks, and an update has to be issued for each app. The second group of apps will be linked next week. Then, Czechia’s eRouška, Denmark’s smitte stop, Latvia’s Apturi COVID and Spain’s Radar Covid are expected to join, while further apps will be linked to the system in November. The overview of participating Member States is available on a dedicated webpage.
The gateway ensures that apps work seamlessly cross-borders. Thus, users will only need to install one app and when they travel to another participating European country they will still benefit from contact tracing and receiving alerts, be it in their home country or abroad. The gateway server keeps the amount of data exchanged to a minimum. It will efficiently receive and pass on arbitrary identifiers between national apps. No other information than arbitrary keys, generated by the apps, will be handled by the gateway: the information is pseudonymised, encrypted, kept to the minimium, and only stored as long as necessary to trace back infections. It does not allow the identification of individual persons, nor to track location or movement of devices.
The setup of the gateway follows the agreement by Member States on technical specifications to ensure a safe exchange of information between the backend servers of national contact tracing and warning apps based on a decentralised architecture. The system was developed and set up in less than two months by T-Systems and SAP, and will be operated from the Commission’s data centre in Luxembourg.
Background
Contact tracing apps, if fully compliant with EU rules and well-coordinated, can play a key role in all phases of crisis management. They can complement existing manual contact tracing and help interrupt the transmission chain of the virus. Thereby, they can contribute to saving lives.
Since the outbreak of the coronavirus pandemic, Member States, backed by the Commission, have been assessing the effectiveness, security, privacy, and data protection aspects of digital solutions to address the crisis. They have developed an EU toolbox for contact tracing and warning apps, which was accompanied by guidance on data protection. This was part of a common coordinated approach to support the gradual lifting of confinement measures, as set out in a Commission Recommendation. To ensure tracing and warning apps work cross-border, Member States, with the support of the Commission agreed on interoperability guidelines in May, on a set of technical specifications in June, and the Commission adopted an Implementing Decision to provide a legal basis for the gateway service. In September, the system was tested in a pilot phase.
Compliments of the European Commission
The post Coronavirus: EU interoperability gateway goes live, first contact tracing and warning apps linked to the system first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Today, the Commission adopted its 2021 work programme, designed to make Europe healthier, fairer and more prosperous, while accelerating its long-term transformation into a greener economy, fit for the digital age. It contains new legislative initiatives across all six headline ambitions of President von der Leyen’s Political Guidelines and follows her first State of the Union Speech. While delivering on the priorities set out in this work programme, the Commission will continue to put all its efforts into managing the crisis, and into making Europe’s economies and societies more resilient.
Ursula von der Leyen, President of the European Commission, said: “Our utmost priority will continue being to save lives and livelihoods threatened by the coronavirus pandemic. We have already achieved a lot. But Europe is not out of the woods yet and the second wave is hitting hard across Europe. We must remain vigilant and step up, all of us. The European Commission will continue its efforts to secure a future vaccine for Europeans and to help our economies recover, through the green and digital transition.”
Maroš Šefčovič, Vice-President in charge of Interinstitutional Relations and Foresight, said: “Whilst ensuring Europe can manage the pandemic and its devastating impact, we also continue to draw lessons from the crisis. Therefore, the priorities set out in this work programme will not only help deliver Europe’s recovery but also our long-term resilience – through future-proof solutions across all policy areas. For that, we will make the best use of strategic foresight as well as our better law-making principles – evidence-based and transparent, efficient and fit for the future.”
Delivering on EU priorities
The 2021 Commission work programme sees a shift from strategy to delivery across all six political priorities. It confirms the Commission’s resolve to lead the twin green and digital transition – an unparalleled opportunity to move out of the fragility of the crisis and create a new vitality for the Union.

A European Green Deal

To achieve a climate-neutral Europe by 2050, the Commission will table a Fit for 55 package to reduce emissions by at least 55% by 2030. This will cover wide-ranging policy areas – from renewables to energy efficiency first, energy performance of buildings, as well as land use, energy taxation, effort sharing and emissions trading. A Carbon Border Adjustment Mechanism will help reduce the risk of carbon leakage and ensure a level-playing field by encouraging EU partners to raise their climate ambition. In addition, the Commission will propose measures to implement Europe’s circular economy action plan, the EU biodiversity strategy and the farm to fork strategy.

A Europe fit for the digital age

To make this Europe’s digital decade, the Commission will put forward a roadmap of clearly defined 2030 digital targets, related to connectivity, skills and digital public services. The focus will be on the right to privacy and connectivity, freedom of speech, free flow of data and cybersecurity. The Commission will legislate in areas covering safety, liability, fundamental rights and data aspects of artificial intelligence. In the same spirit, it will propose a European e-ID. Initiatives will also include an update of the new industrial strategy for Europe, to take into account the impacts of the coronavirus, as well as a legislative proposal to improve the working conditions of platform workers.

An economy that works for people

To ensure that the health and economic crisis does not turn into a social crisis, the Commission will put forward an ambitious action plan to implement fully the European Pillar of Social Rights, making sure that no one is left behind in Europe’s recovery. The Commission will also come forward with a new European child guarantee, ensuring access to basic services like health and education for all children. To support our economies and strengthen the Economic and Monetary Union, it will revise the framework for handling EU bank failures, take measures to boost cross-border investment in the EU, and step up the fight against money laundering.

A stronger Europe in the world

The Commission will ensure that Europe plays its vital role in this fragile world, including by leading the global response to secure a safe and accessible vaccine for all. It will propose a Joint Communication on strengthening the EU’s contribution to a rules‑based multilateralism, a renewed partnership with our Southern neighbourhood and a Communication on the Arctic. A new strategic approach to support disarmament, demobilisation and reintegration of ex-combatants will also be presented. A Communication on the EU’s humanitarian aid will explore new ways of working with our partners and other donors.

Promoting our European way of life

In the face of COVID-19, the Commission will propose to build a stronger European Health Union, notably by strengthening the role of existing agencies and establishing a new agency for biomedical advanced research and development. To preserve and improve its functioning, a new strategy for the future of Schengen will be tabled. The new pact on migration and asylum will be followed up with a number of proposed measures on legal migration, including a ‘talent and skills’ package. Other elements include an action plan against migrant smuggling, as well as a sustainable voluntary return and reintegration strategy. The Commission will continue to strengthen the Security Union, addressing terrorism, organised crime and hybrid threats. It will also present a comprehensive strategy on combating antisemitism.

A new push for European democracy

To build a union of equality, the Commission will present new strategies on rights of the child and for persons with disabilities, as well as a proposal to combat gender-based violence. It will also propose to extend the list of euro-crimes to include all forms of hate crime and hate speech. The Commission will propose clearer rules on the financing of European political parties and take action to protect journalists and civil society against abusive litigation. A long-term vision for rural areas will propose actions to harness the full potential of these regions.
Given the long-term and transformative nature of the initiatives planned, it is more important than ever to legislate in the most impactful way and with the future in mind. The upcoming Communication on Better Regulation will renew this emphasis. It will focus on simplification and burden reduction, notably by introducing a ‘one-in-one-out’ approach. The Fit for Future Platform will support the Commission in this ambition, particularly needed in the aftermath of the COVID-19 pandemic. To deliver on the ground, the Commission will also step up its outreach, with the Conference on the Future of Europe playing a central role.
A full list of the 44 new policy objectives under the six headline ambitions are set out in Annex 1 of the 2021 work programme.
Next Steps
The Commission’s 2021 work programme is the result of close cooperation with the European Parliament, Member States and the EU consultative bodies. The Commission will now start discussions with the Parliament and Council to establish a list of joint priorities on which co-legislators agree to take swift action.
Background
Every year, the Commission adopts a work programme setting out the list of actions it will take in the coming twelve months. The work programme informs the public and the co-legislators of our political commitments to present new initiatives, withdraw pending proposals and review existing EU legislation. It does not cover the ongoing work of the Commission to implement its role as Guardian of the Treaties and enforce existing legislation or the regular initiatives that the Commission adopts every year.
The 2021 Commission work programme is closely linked to the recovery plan for Europe, with the NextGenerationEU recovery instrument and a reinforced EU budget for 2021-2027. The Recovery and Resilience Facility will channel an unprecedented €672.5 billion of grants and loans in the crucial first year of recovery. Meanwhile, Member States are drawing up recovery and resilience plans that set out reforms and investments aligned with the EU green and digital policy objectives: with a minimum 37% of green transition expenditure, and a minimum 20% related to digital. To repay the funds raised under NextGenerationEU, the Commission will put forward proposals for new own resources starting with a revised Emission Trading System, a Carbon Border Adjustment Mechanism and a digital levy.
Compliments of the European Commission
The post 2021 EU Commission work programme – from strategy to delivery first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Several senior EU representatives are participating to the 2020 edition of the Annual Meetings of the World Bank and the International Monetary Fund (October 5-23), which are held virtually due to the COVID-19 pandemic.
European Commission Executive Vice President Valdis Dombrovskis speaks at two high-level climate and sustainable finance events. On October 12, he joined the Fourth Ministerial-Level Meeting Coalition of Finance Ministers for Climate Action. He will also speak alongside IMF Managing Director Kristalina Georgieva and other counterparts at the event celebrating the first anniversary of the International Platform for Sustainable Finance (IPSF) on October 16 (event livestreamed by the IMF at 10am ET here(link is external)). The IPSF works towards improved transparency in global markets for sustainable finance to unlock financial resources for a green recovery from the Covid-19 crisis.
Executive Vice-President Dombrovskis will also participate in the Institute of International Finance (IIF) Annual Membership meeting and represent the EU at the International Monetary and Financial Committee plenary (IMFC) on October 15.
The European Commissioner for International Partnerships, Jutta Urpilainen, participated in a High-level Ministerial Meeting on Sahel, Economic Challenges from the security crisis in the Sahel on October 8, a High-Level discussion on Mobilizing with Africa II on October 9, and a meeting on Governance of COVID-19 Emergency Financing on October 12. She will also participate to the Development Committee Meeting on October 16 and to a discussion on a Resilient Recovery from COVID-19 in Fragile Settings on October 19. The Commissioner will promote a global recovery that links debt relief and investment to SDGs and the Paris Agreement.
The European Commissioner for the Economy, Paolo Gentiloni, participates in the G20 Finance Ministers and Central Bank Governors meeting on October 15. In addition, Commissioner Gentiloni will speak at a panel discussion on fiscal policy in Europe and the United States hosted by UBS and the Reinventing Bretton Woods Committee, also on October 15.
The European Commissioner for Budget and Administration, Johannes Hahn, will be speaking at an event, together with Managing Director of the European Stability Mechanism (ESM) Klaus Regling, and European Investment Bank (EIB) Vice-President Ambroise Fayolle, organized by DZ Bank and the Official Monetary and Financial Institutions Forum on Europe’s sustainable recovery on October 15.
The European Commission Directorate-General for International Cooperation and Development (DEVCO) organized a discussion on Sustainable Transformation of Societies: A Green Consensus for Macro-Fiscal Policies on October 9, which featured Environment Commissioner Virginijus Sinkevičius and aimed to galvanize support for a new consensus within the Bretton Woods institutions and to advise partner countries to pursue an equitable, resilient, green and sustainable recovery.
Finally, EIB President Werner Hoyer and Vice-Presidents Ambroise Fayolle and Lilyana Pavlova will lead the EU Bank’s delegation at the Annual Meetings. EIB leadership and experts will discuss how to best respond to the COVID-19 pandemic worldwide, while supporting a green recovery. They will highlight the importance of multilateralism as a response to global challenges, including gender equality and women’s economic empowerment. Learn more on the EIB’s participation here.
Compliments of the Delegation of the European Union to the United States.
The post EU at the 2020 Annual Meetings of the IMF and the World Bank first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

When paying for coffee, we swipe, tap, wave, and soon may wink—a quick and painless exchange of coffee for money. But when paying for imports or sending remittances, we often fill-out forms, wait for days, and pay—too much.
Progress to improve cross-border payments has been slow, but is just about to take off. That is how history evolves—one small step at a time, until it suddenly leaps forward. The confluence of new technologies and renewed determination among policymakers are making significant improvements possible. Meanwhile, households and firms have come to expect (and demand) better services.
Reforms have the potential to be transformative by making cross-border payments cheaper, faster, more transparent, and more widely accessible.
The stakes are high. Changes to cross-border payments have a bearing on the stability of the international monetary system, on financial inclusion, and on the efficiency of trade and financial markets. And reforms may unlock innovation and much needed growth, particularly following the COVID-19 crisis. But a leap forward will only be possible if the world works together.
And it has—in an exceptional manner. A roadmap to decisively enhance cross-border payments, led by the Financial Stability Board along with a wide set of institutions including the IMF, has just been endorsed by the G20. This is not simply one more report, but a set of concrete reforms, practical steps, and milestones that specific institutions will be held accountable to implement. Meanwhile, the IMF just published a staff paper on the macro-financial implications of new forms of digital money available across borders. Together, these papers provide a clear path forward, mindful of the challenges that lie ahead. If implemented, reforms have the potential to be transformative by making cross-border payments cheaper, faster, more transparent, and more widely accessible.
The next step
While international cooperation has gotten us this far, it will be all the more important to implement, and potentially even surpass, the G20 roadmap. Specifically, we need cooperation in four broad areas to ensure improvements to cross-border payments are effective, sustainable, safe, and equitable.
First, solutions to cross-border payments must be designed and pursued with all countries in mind. Countries differ considerably in implementation capacity, existing infrastructure, and financial sector development. And with different countries come different users. These cover large companies operating in less liquid markets, cost-conscious small- and medium-sized enterprises, and the 1 billion people sending and receiving remittances (which at an average cost of 7 percent are still double the target set by United Nations’ Development Goals).
The G20 roadmap is appropriately flexible given this diversity of needs. Some solutions involve improvements to existing systems, such as devising trustworthy digital identities essential for financial inclusion. Others are more exploratory and consider a world in which we can freely trade digital currencies across borders, much like we send emails today. It is essential that all these solutions continue to be pursued, discussed, tested, and some discarded—with an open mind.
Second, cooperation is essential to overcome countries’ “inaction bias,” and ensure solutions are widely applicable. A simple example is the operating hours of countries’ settlement systems: only when two countries extend hours so they overlap can cross-border transactions be settled in real time. No country will want to act alone. Even then, the two systems must talk to each other. But interoperability is not a given. It requires basic technological, design, legal, and regulatory standards. Cooperation will ensure these satisfy the needs of a wide community, which the IMF can help congregate.
Third, cooperation is critical to build solutions that benefit from the experience and perspective of all relevant actors—such as central banks, regulators, finance ministries, anti-trust agencies, data protection agencies, and international organizations. The Financial Stability Board report was exemplary in this respect. Moreover, the public and private sectors must cooperate, recognizing each other’s strengths: private companies to innovate and interact with users, and the public sector to regulate, supervise, and ultimately provide trust to the system. Where possible, public-private solutions should be explored.
Lastly, cooperation means recognizing the macro-financial effects that one country’s policies can have on others. For instance, new forms of digital money issued in major reserve currencies could improve domestic as well as cross-border payments. But they could also induce citizens abroad to forego their domestic currency, especially in countries with high inflation and volatile exchange rates. And digital money could potentially facilitate bank runs out of these countries. Meanwhile, source countries could see more volatile capital inflows and central bank balance sheets. Moreover, it is unclear if capital account restrictions, which many countries adopt, can be redesigned so they are not circumvented by digital money. Finally, the use of digital money could raise significant risks to financial integrity. These and other scenarios are detailed in our new paper.
Global links
Monetary policy, financial stability, capital flows, international reserves—all could be affected by transformations in cross-border payments, with implications for the international monetary system. The IMF’s founding members understood this link, which to some extent lies behind the vision to “assist in the establishment of a multilateral system of payments,” as stated in the Articles of Agreement.
Today, the IMF continues to play an active role in this space, working hand-in-hand with other international organizations. Our near-universal membership can help ensure that the digital revolution benefits people in all countries. And our global perspective can help recognize spillover effects, as well as provide a common forum to address the underlying policy dilemmas. Let’s engage on this promising path together.
Authors:

Tobias Adrian, the Financial Counsellor and Director of the IMF’s Monetary and Capital Markets Department

Kristalina Georgieva, Managing Director of the IMF

Compliments of the IMF.
The post IMF | A Leap Forward on Cross-Border Payments first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

I. COVID-19
1. The European Council assessed the current epidemiological situation, which is unprecedented and gives rise to very serious concern.
2. It welcomed the progress achieved so far on overall coordination at EU level against COVID‑19, including the recommendation on a coordinated approach to the restriction of free movement. It calls on the Council, the Commission and the Member States to continue the overall coordination effort based on the best available science, notably regarding quarantine regulations, cross-border contact tracing, testing strategies, the joint assessment of testing methods, the mutual recognition of tests, and the temporary restriction on non-essential travel into the EU. The European Council will regularly revert to this matter.
3. Welcoming the work at EU level on the development and distribution of vaccines, the European Council reiterates the need for a robust authorisation and monitoring process, the building of vaccination capacity in the EU, and fair and affordable access to vaccines. The European Council also encourages further cooperation at global level.
II. EU-UK relations

European Council conclusions on EU-UK relations, 15 October 2020

III. Climate change
10. To meet the objective of a climate-neutral EU by 2050 in line with the objectives of the Paris Agreement, the EU needs to increase its ambition for the coming decade and update its climate and energy policy framework. In that context, the European Council discussed the Commissionʼs Communication on ‘Stepping up Europeʼs 2030 climate ambition’, including the proposed emissions reduction target of at least 55% by 2030, and the actions required to achieve that ambition.
11. Recalling its previous conclusions, the European Council considers that the updated target should be delivered collectively by the EU in the most cost-effective manner possible. All Member States will participate in this effort, taking into account national circumstances and considerations of fairness and solidarity. All relevant EU legislation and policies need to contribute to the new 2030 target and to the fulfilment of the climate neutrality objective, while respecting a level playing field and preventing carbon leakage.
12. The European Council invites the Council to take work on this agenda forward. It invites the Commission to conduct in-depth consultations with Member States to assess the specific situations and to provide more information about the impact at Member Statesʼ level. The European Council will return to the issue at its December meeting with a view to agreeing a new emissions reduction target for 2030 and the submission of the EUʼs updated nationally determined contribution (NDC) to the UNFCCC before the end of the year.
13. The European Council calls upon all other Parties to also submit an updated NDC. It underlines the importance of strong coordinated action through active European climate diplomacy, with a view to joining forces on the global stage to further advance the cause of fighting climate change.
Compliments of the European Council.
The post European Council conclusions on COVID-19 and climate change, 15 October 2020 first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

Statements and remarks by President Charles Michel | 15 October 2020
First of all I would like to apologise for the absence of the President of the European Commission. At the beginning of the meeting she was informed that a person considered a ‘close contact’ had tested positive. She herself tested negative today. Nevertheless, in accordance with the national rules, she has decided to self-isolate.
We have had the opportunity today to hold a debate as planned on the future relationship between the European Union and the United Kingdom.
On Brexit, we are united and determined to reach an agreement. But not at any cost.
Any agreement on our future relationship would have to be based on our mandate, in particular when it comes to the level playing field, fisheries and governance.
A level playing field is critical because it ensures fair competition. For example, if the UK were to produce cars without respecting our EU standards, and with the support of massive subsidies, how could we be expected to grant them access to our markets with no tariffs and no quotas? That would be unfair and would risk hundreds of thousands of European jobs.
On those issues, we are concerned by the lack of progress at the negotiating table. We are 100 percent united. And we fully trust and support our chief negotiator, Michel Barnier, to continue negotiations. And we call on the UK to make the necessary moves.
As regards the Withdrawal Agreement and its Protocols, they must be fully implemented. Full stop. And that’s also a question of international credibility for the UK.
In parallel, we will step up our work, at all levels and for all outcomes, including that of a no deal.
You will have gathered that we have had the opportunity today not only to listen carefully to the briefing given by our chief negotiator Michel Barnier. We have also underlined the unity of the European Union in this negotiation process. We wish to do our utmost to make an agreement with the United Kingdom possible; at the same time, we will continue to defend the principles we deem important: the level playing field, the governance of the agreement and the question of fisheries are, of course, issues for which we have, from the outset, set out a series of principles and commitments of importance to us.
We are ready to continue the negotiations, and we have stated an extremely calm, equable European position – it is against this backdrop that we hope progress can be made so as to achieve clarity as soon as possible.
Compliments of the European Council.
The post Remarks by President Charles Michel following the first working session of the European Council first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

This report provides an update on work by the FSB, in collaboration with the international standard setting- bodies, to address market fragmentation. The report was delivered to G20 Finance Ministers and Central Bank Governors ahead of their meeting in October.
In June 2019, the FSB identified four areas for further work to address market fragmentation: This latest progress report provides an update on work in these areas:

Deference. The International Organization of Securities Commissions published a Report on Good Practices on Processes for Deference in June 2020 that should help authorities to mitigate the risk of unintended, regulatory-driven, fragmentation in wholesale securities and derivatives markets.

Pre-positioning of capital and liquidity. FSB members are continuing work related to the distribution of resources within global systemically important banks (G-SIB) having regard to the need to achieve a balance between certainty for host jurisdictions and flexibility to deploy resources where needed within a group in times of stress. The FSB is also working on identifying ways to further promote effective cooperation and coordination in crisis times.

Regulatory and supervisory coordination and information sharing. Regulatory and supervisory coordination and information sharing have focused on policy measures taken in response to COVID-19. The FSB has established a repository of regulatory and supervisory policy measures taken in its member jurisdictions in response to the COVID-19 pandemic. The FSB is also exploring potential ways to facilitate convergence in reporting of data to authorities.

“Too-big-to-fail” (TBTF) evaluation. The FSB has publicly consulted on its evaluation on the effects of TBTF reforms for systemically important banks. The evaluation finds no evidence that the implementation of reforms has reduced cross-border lending.

Looking beyond these specific areas, the policy response to COVID-19 has underlined policymakers’ awareness of harmful effects of market fragmentation. The official sector community has provided a rapid and coordinated response to support the real economy, maintain financial stability and minimise the risk of market fragmentation.
Compliments of the Financial Stability Board.
The post FSB | Market Fragmentation: updates on ongoing work first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.