June 10, 2020 |
The OECD Economic Outlook is the OECD’s twice-yearly analysis of the major economic trends and prospects for the next two years. The Outlook puts forward a consistent set of projections for output, employment, prices, fiscal and current account balances.
Coverage is provided for all OECD member countries as well as for selected non-member countries. This issue includes a general assessment of the macroeconomic situation, a series of notes on the macroeconomic and structural policy issues related to the COVID-19 outbreak and a chapter summarising developments and providing projections for each individual country.
SUMMARY of the findings can be found here: OECD Economic Outlook, June 2020Read the FULL publication here: OECD Economic Outlook, Volume 2020 Issue 1The VIDEO Press conference can be found here: OECD Economic Outlook, Press Conference
After the lockdown, a tightrope walk toward recovery
The spread of Covid-19 has shaken people’s lives around the globe in an extraordinary way, threatening health, disrupting economic activity, and hurting wellbeing and jobs. Since our last Economic Outlook update, in early March, multiple virus outbreaks evolved into a global pandemic, moving too fast across the globe for most healthcare systems to cope with effectively. To reduce the spread of the virus and buy time to strengthen healthcare systems, governments had to shut down large segments of economic activity. At the time of writing, the pandemic has started to recede in many countries, and activity has begun to pick up. The health, social and economic impact of the outbreak could have been considerably worse without the dedication of healthcare and other essential workers who continued to serve the public, putting their own health at risk in doing so.
Governments and central banks have put in place wide-ranging policies to protect people and businesses from the consequences of the sudden stop in activity. Economic activity has collapsed across the OECD during shutdowns, by as much as 20 to 30% in some countries, an extraordinary shock. Borders have been closed and trade has plummeted. Simultaneously, governments implemented quick, large and innovative support measures to cushion the blow, subsidising workers and firms. Social and financial safety nets were strengthened at record speed. As financial stress surged, central banks took forceful and timely action, deploying an array of conventional and unconventional policies above and beyond those used in the Global Financial Crisis, preventing the health and economic crisis from spilling over into a financial one.
As long as no vaccine or treatment is widely available, policymakers around the world will continue to walk on a tightrope. Physical distancing and testing, tracking, tracing and isolating (TTTI) will be the main instruments to fight the spread of the virus. TTTI is indispensable for economic and social activities to resume. But those sectors affected by border closures and those requiring close personal contact, such as tourism, travel, entertainment, restaurants and accommodation will not resume as before. TTTI may not even be enough to prevent a second outbreak of the virus.
Faced with this extraordinary uncertainty, this Economic Outlook presents two possible scenarios: one where the virus continues to recede and remains under control, and one where a second wave of rapid contagion erupts later in 2020. These scenarios are by no means exhaustive, but they help frame the field of possibilities and sharpen policies to walk such uncharted grounds. Both scenarios are sobering, as economic activity does not and cannot return to normal under these circumstances. By the end of 2021, the loss of income exceeds that of any previous recession over the last 100 years outside wartime, with dire and long-lasting consequences for people, firms and governments.
The pandemic has accelerated the shift from “great integration” to “great fragmentation”. Additional trade and investment restrictions have sprung up. Many borders are closed across large regions and will likely remain so, at least in part, as long as sizeable virus outbreaks continue. Economies are diverging, depending on when and to what extent they were hit by the virus, the preparedness of their healthcare system, their sectoral specialisation and their fiscal capacity to address the shock. Emerging-market economies have also been shaken by the crisis. Commodity prices have plummeted. Large capital outflows, plummeting remittances, weaker healthcare systems and a large share of informal workers have threatened their health, economic and social resilience. Everywhere, the lockdown has also exacerbated inequality across workers, with those able to telework generally highly qualified, while the least qualified and youth are often on the front line, unable to work or laid off, with the effects further compounded by unequal access to social protection. Private debt levels are uncomfortably high in some countries, and business failure and bankruptcy risks loom large.
Extraordinary policies will be required to walk the tightrope towards recovery. Even if growth does surge in some sectors, overall activity will remain muted for a while. Governments can provide the safety nets that allow people and firms to adjust, but cannot uphold private sector activity, employment and wages for a prolonged period. Capital and workers from impaired sectors and businesses will have to move towards expanding ones. Such transitions are difficult, and rarely happen fast enough to prevent the number of failing firms from rising and a sustained period of unemployment. Governments will need to adapt support and accompany the transition, allowing fast restructuring processes for firms, with no stigma for entrepreneurs, providing income for workers in between jobs, training for those laid off and transitioning to new jobs, and social protection for the most vulnerable. We have previously called for a rise in public investment in digital and green technologies to promote long-term sustainable growth and lift demand in the short term. This is even more urgent today with economies having been hit so hard.
Today’s recovery policies will shape economic and social prospects in the coming decade. Ultra-accommodative monetary policies and higher public debt are necessary and will be accepted as long as economic activity and inflation are depressed, and unemployment is high. However, debt-financed spending should be well targeted to support the most vulnerable and the investment necessary for a transition to a more robust economy. Public support needs to be transparent and fair. Corporate support from governments must come with transparent rules, with private bond and equity holders taking a loss when government steps in, so that their rewards for taking risks are not excessive. Improving employer-employee relationships should accompany ongoing public support for workers and firms, paving the way for stronger social cohesion and ultimately a stronger and more sustainable recovery.
The recovery will not gain steam without more confidence, which will not fully recover without global cooperation. Confidence needs to be boosted both at the national and international levels. Household saving rates have soared in most OECD countries, with high uncertainty and rising unemployment holding back consumption. Trade disruptions and the associated threats to supply chains also impede the necessary reduction in uncertainty for investment to resume. Global cooperation to tackle the virus with a treatment and vaccine and a broader resumption of multilateral dialogue will be key for reducing doubt and unlock economic momentum. The international community should ensure that when a vaccine or treatment is available it can be distributed rapidly worldwide. Otherwise the threat will stay. Likewise, resuming a constructive dialogue on trade would lift business confidence and the appetite for investment.
Governments must seize this opportunity to engineer a fairer and more sustainable economy, making competition and regulation smarter, modernising government taxes, spending, and social protection. Prosperity comes from dialogue and cooperation. This holds true at the national and global level.
AUTHOR:
• Laurence Boone, OECD Chief Economist
Compliments of the OECD.
 

June 08, 2020 |
The Federal Reserve Board on Monday expanded its Main Street Lending Program to allow more small and medium-sized businesses to be able to receive support. The Board lowered the minimum loan amount, raised the maximum loan limit, adjusted the principal repayment schedule to begin after two years, and extended the term to five years, providing borrowers with greater flexibility in repaying the loans. The Board expects the Main Street program to be open for lender registration soon and to be actively buying loans shortly afterwards.
“Supporting small and mid-sized businesses so they are ready to reopen and rehire workers will help foster a broad-based economic recovery,” Federal Reserve Chair Jerome H. Powell said. “I am confident the changes we are making will improve the ability of the Main Street Lending Program to support employment during this difficult period.”
Small and medium-sized businesses are a vital part of the economy and employ tens of millions of people, and, because their needs vary widely, the Board has extensively sought feedback and revised the Main Street program accordingly.
The changes include:
• Lowering the minimum loan size for certain loans to $250,000 from $500,000;
• Increasing the maximum loan size for all facilities;
• Increasing the term of each loan option to five years, from four years;
• Extending the repayment period for all loans by delaying principal payments for two years, rather than one; and
• Raising the Reserve Bank’s participation to 95% for all loans.
The chart below has additional details on the changes.
Once they have successfully registered for the program, lenders are encouraged to begin making Main Street loans immediately. The Main Street Lending Program intends to purchase 95% of each eligible loan that is submitted to the program, provided that the required documentation is complete and the transactions are consistent with the relevant Main Street facility’s requirements. The Main Street Lending Program will also accept loans that were originated under the previously announced terms, if funded before June 10, 2020.
Nonprofit organizations play a critical role throughout the economy, and the Board is working to establish a program soon for these organizations.
The Main Street Lending Program was established with the approval of the Treasury Secretary and with $75 billion in equity provided by the Treasury Department from the CARES Act. Additional frequently asked questions and answers for lenders and borrowers are also available. The form participation agreement and other legal forms will be updated to align with the changes announced today.
Main Street Lending Program Loan Options
New Loans
Priority Loans
Expanded Loans
Term
5 years(previously 4 years)
Minimum Loan Size
$250,000(previously $500,000)
$10M
Maximum Loan Size
The lesser of $35M, or an amount that, when added to outstanding and undrawn available debt, does not exceed 4.0x adjusted EBITDA(previously $25M)
The lesser of $50M, or an amount that, when added to outstanding or undrawn available debt, does not exceed 6.0x adjusted EBITDA(previously $25M)
The lesser of $300M, or an amount that, when added to outstanding or undrawn available debt, does not exceed 6.0x adjusted EBITDA(previously $200M)
Risk Retention
5%
5%(previously 15%)
5%
Principal Repayment
Principal deferred for two years, years 3-5: 15%, 15%, 70%
(previously principal deferred for one year and 33.33% repayment due in years 2-4)
Principal deferred for two years, years 3-5: 15%, 15%, 70%
(previously principal deferred for one year and 15%, 15%, 70% repayment due in years 2, 3, and 4, respectively)
Interest Payments
Deferred for one year
Rate
LIBOR + 3%
Compliments of the Federal Reserve Board.

June 09, 2020 |
• Euro remains unchallenged as second most used currency globally after the US dollar
• Role of euro stable as global reserve currency
• International role declined after the global financial crisis, now bottomed out
• Euro used as main currency of denomination globally for green bond issuance
The euro’s international role remained overall stable in 2019. This was one of the principal findings in the latest annual report on The international role of the euro, published today by the European Central Bank (ECB).
Adjusting for exchange rate valuation effects, the share of the euro in outstanding international loans was 1 percentage point higher at the end of 2019 than at the end of 2018, at 15.4%. The share of the euro in outstanding international debt securities declined. The share of the euro in global foreign exchange reserves and in outstanding international deposits remained broadly stable, as did the share of the euro as an invoicing currency for extra-euro area transactions in goods and the stock of euro banknotes circulating outside the euro area.
Since its introduction 20 years ago, the euro has remained unchallenged as second most used currency globally after the US dollar, but its usage declined after the global financial crisis, bottoming out in 2016. The international role of the euro is primarily supported by a deeper and more complete Economic and Monetary Union (EMU), including advancing the capital markets union, in the context of the pursuit of sound economic policies in the euro area.
“The recent COVID-19 pandemic underlines the urgency of these policies and reform efforts, which are paramount to raising the attractiveness of the euro globally”, said ECB President Christine Lagarde.
The report also contains a box on the role of the euro in global green bond markets, with the euro being the main currency of denomination for the issuance of green bonds in 2019. “The swift implementation of an EU taxonomy of sustainable economic activities would provide a credible and standardised framework, ensure greater investor confidence and could thereby also contribute to strengthening the international role of the euro”, said Fabio Panetta, member of the ECB’s Executive Board.
Compliments of the ECB.

The Federal Reserve wants to hear from you.
Now, more than ever, we need to elevate community voices to inform meaningful actions. We want to hear from you and learn how the pandemic is affecting your community.
In April, the Federal Reserve System conducted a survey to better understand the range of challenges facing under-resourced and low-income communities as an effect of COVID-19. The findings are available in Perspectives from Main Street: The Impact of COVID-19 on Communities and the Entities Serving Them and helped us understand how the pandemic is impacting organizations, like yours, supporting community needs.
We are committed to fielding this survey every eight weeks to report on how the effects of COVID-19 are changing within communities over time. Please take this survey today. The survey should take about 10 minutes to complete.
START SURVEY
The survey will close at 11:59 p.m. ET on Friday, June 12, 2020.
We also invite you to participate in the upcoming Federal Reserve Bank of New York’s Fed & Main Street series, The Immigrant Experience during COVID-19, where key advocates will cover topics ranging from the challenges of immigrant populations during the pandemic to cross-sector efforts to address financial and economic disparities. In addition, visit the Community Resources on Coronavirus hub from the Federal Reserve Bank of New York that you may find useful.
Thank you for your time and for your shared commitment to supporting our communities. We encourage you to forward the survey link to others who have unique knowledge of what is happening in their communities.
Compliments of the Federal Reserve of New York.

Together with our members we are creating a Video series of first-hand accounts of the Pandemic’s impact, both personally & professionally.
We invite you to join us today for a first-hand look at the impact of the global shutdown following the Coronavirus (COVID-19) outbreak – Today we are featuring Cameron Heffernan, Director of North America, Mach Media a EACCNY member.The questions we asked our members for this series are:1) What are some challenges you, personally and your organization have faced?2) What are some of the most surprising (positive, innovative) responses/changes you have witnessed?3) How will this experience change us going forward, as a society and in terms of how we do business?

EACCNY has its finger on the pulse of how this worldwide pandemic is effecting companies and organizations on both sides of the Atlantic. EACC is where Americans & Europeans connect to do business.
Stay tuned for more on this series! We hope you enjoy these short vignettes our members and friends of the EACC created to share their experience.
 

June 08, 2020 |
The Council approved conclusions on the “Team Europe” package that is part of the EU’s global response to the COVID-19 pandemic.
In its conclusions the Council expresses its deep concern about the global spread of the COVID‑19 pandemic, which continues to claim lives worldwide and have far-reaching social and economic effects.
The Council stresses the urgency of protecting the lives and livelihoods of all people, leaving no-one behind, and of prioritising efforts in partner countries that are most in need.
In light of that the Council fully supports the “Team Europe” approach and welcomes the announcement that almost 36 billion euro have now been mobilised and will be used to address the devastating effects of the COVID-19 crisis in partner countries and regions.
The Council conclusions call for full and effective implementation of a package that should allocate resources to partner countries in cooperation with them, and on the basis of a joint assessment of needs.
The Council also emphasises the need to ensure a link with medium- and long-term programming, and proper coordination with all actors involved, including the UN, regional organisations such as the African Union, and other international multilateral organisations and financial institutions.
Background
The “Team Europe” package was launched on 8 April 2020 to support EU partner countries in the fight against the COVID-19 pandemic and its consequences. The financial support initially pledged was around 20 billion euro and combined resources from the EU, its member states, and financial institutions, in particular the European Investment Bank and the European Bank for Reconstruction and Development.
Text of the Council conclusions
Updated annex to the Council conclusions
Joint Communication on the Global EU Response to COVID-19, 8 April 2020
EU “Team Europe” Package launched, 8 April 2020 (EEAS Website)
EU Humanitarian & Emergency Response (EEAS, Website)
Compliments of the European Commission.

June 05, 2020 |
Well-functioning and liquid gas markets are a prerequisite for ensuring affordable energy for consumers, competitiveness of industries, and security of supply. They also play a role in achieving the environmental ambitions of the European Green Deal, which foresees the decarbonisation of the gas sector via a forward-looking design for a competitive decarbonised gas market.
To support the reflections on the possible need to enhance the EU regulatory framework for gas markets in the context of the European Green Deal and the trajectory towards the decarbonisation of gas, two studies have been published, commissioned by the Directorate-General for Energy of the European Commission.
It is important to note that the studies reflect only the views of the authors. They have neither been adopted nor in any way approved by the Commission and should not be relied upon as a statement of the Commission’s views. The results of the studies do not bind the Commission in any way. Any possible implementation of options and/or recommendations identified will be assessed in the context of the policy objectives established in the Green Deal Strategy and subject to an impact assessment.
Gas market upgrading and modernisation – Regulatory framework for LNG terminals
The study was conducted by a consortium of consultants led by Trinomics in collaboration with REKK and Equidity. The study identifies barriers and gaps that may need to be addressed in order to ensure optimal use of existing LNG terminals in the EU. This finding is especially relevant due to the significant increase of LNG imports to the EU in the recent years. The study suggests recommendations that would allow the better use of existing LNG terminal capacities, improve their link with the gas market, and facilitate the response to market demand.
Upgrading the gas market – Regulatory and administrative requirements to entry and trade on gas wholesale markets in the EU
The study was conducted by a consortium of consultants led by Schönherr attorneys at law, identifying existing administrative and regulatory requirements to enter and trade on the EU wholesale gas markets.. Based on the overview of current barriers to entry and trade on wholesale gas markets, possible legislative options at EU-level to mitigate them are analysed, including mutual recognition, minimum requirements, an EU pass porting system, and the abolishment of licensing requirements.
Compliments of the European Commission.

June 08, 2020 |
• Further decline – by 6.3% on average – in number of bank branches in most EU Member States
• Number of bank employees also continued to fall by 0.9% on average
• Share of total assets of the five largest banks, at national level, ranged from 28% to 97%
The European Central Bank (ECB) has updated its dataset of structural financial indicators for the banking sector in the European Union (EU) for the end of 2019. This annual dataset comprises statistics on the number of branches and employees of EU credit institutions, data on the degree of concentration of the banking sector in each EU Member State, and data on foreign-controlled institutions in EU national banking markets.
As for the number of branches, the structural financial indicators show a further decline in the EU, on average by 6.3%. There was a decrease in 25 of 28 EU Member States and, at national level, the decrease in the number of branches varied from 0.9% to 37%. The total number of branches in the EU was 163,265 at the end of 2019 with 79 % of them located in the Euro Area.
The number of employees of credit institutions fell in 20 EU Member States with an average reduction of 0.9% across all countries. Decreasing numbers of bank employees is a trend that has been observed in most countries since 2008.
The data also indicate that the degree of concentration in the banking sector (measured by the share of assets held by the five largest banks) continues to differ widely between EU countries. The share of total assets of the five largest credit institutions, at national level, ranged from 28% to 97%, while the EU average was 65% at the end of 2019. The changes in the share of total assets of the five largest credit institutions varied across countries from -3.1% to 7.8%. In the EU, the average variation was 1.5%.
The structural financial indicators are published by the ECB on an annual basis.

Chart 1 – Number of employees of domestic credit institutions
(thousands)

Notes: Interquartile ranges and medians are calculated across average country values. Data for EU28 countries are available. SOURCE: The ECB

Chart 2 – Share of assets held by the five largest banks
(percentages)

Notes: Interquartile ranges and medians are calculated across average country values. Data for EU28 countries are available. SOURCE: The ECB
Compliments of the ECB.

June 04, 2020 |
The U.S. Census Bureau and the U.S. Bureau of Economic Analysis announced today that the goods and services deficit was $49.4 billion in April, up $7.1 billion from $42.3 billion in March, revised. 
Notably, the Commerce Department reported a record 13.7% drop in imports compared to March, and a 20.5% fall in exports—another record—over the same period.
To access the full report: Monthly U.S. International Trade in Goods and Services, April 2020
Compliments of the US Department of Commerce.

June 05, 2020 | Statement by Michel Barnier
“Check against delivery”

Ladies and gentlemen,
I am happy to be with you again, virtually, at the end of this fourth round of negotiations.
Since the beginning of these negotiations, our objective has been to move forward – in parallel – on all topics of our future relationship – and there are many given that we are aiming for a very ambitious partnership.
To achieve this, as I told you at the end of our last round, we needed to make progress on four big sticking points, namely:
• Fisheries, and free and fair competition, the so-called ‘level playing field’ – two essential elements of the new economic partnership we want to build;
• Guarantees protecting people’s fundamental rights and freedoms needed to underpin a close police and judicial cooperation in criminal matters;
• And finally, the governance of our future relationship.
We therefore decided, with David Frost and the UK delegation, to dedicate time to discussing those four points this week.
And I want to thank David Frost personally, but also the two negotiating teams for the mutual respect that they have shown, for the quality of their work in these difficult circumstances, and for their professionalism.
However, at the end of this week, my responsibility – under the authority of President Ursula von der Leyen – as Union negotiator, is to tell you the truth. And the truth is that there was no substantial progress.
• On fisheries, the United Kingdom did not show any real willingness to explore other approaches than zonal attachment on quota sharing. It also continues to condition access to its waters to an annual negotiation – which is technically impossible for us. Whereas the EU wants to build a more stable economic partnership.
• On the level playing field, we didn’t make any progress on these rules of economic and commercial fair play, despite choosing to focus this week on issues that should have been more consensual, such as non-regression mechanisms on social and environmental standards, climate change, taxation or sustainable development.
• On the governance of our future relationship, we were unable to make progress on the issue of the single governance framework establishing legal linkages between our different areas of cooperation.
• Finally, on police and judicial cooperation in criminal matters, we had a slightly more constructive discussion on the question of commitment to the European Convention on Human Rights, although important questions remain as to how to reflect this commitment in our agreement.
On all these points, we are asking for nothing more than what is in the Political Declaration.
 
Ladies and gentlemen,
We can only take note that there has been no substantial progress since the beginning of these negotiations, and that we cannot continue like this forever.
Especially given the United Kingdom’s continued refusal to extend the transition period.
On our side, as President Ursula von der Leyen has said, we were always open to the possibility of a one- or two-year extension, as foreseen in the Withdrawal Agreement. Our door remains open.
But if there is no joint decision on such an extension – as I understand this to be the case – the UK will leave the Single Market and the Customs Union in less than 7 months.
Taking into account the time needed to ratify a deal, we would need a full legal text by 31 October at the latest, i.e. in less than 5 months.
We must use this time in the best possible way.
That is why I suggested, last week already, to David Frost, to accompany our negotiation rounds on all topics with more restricted formats so that we can concentrate on the more difficult issues.
I hope that this will help to inject new political dynamism in the 11 negotiating tables, which we hope will be able to meet physically again in the coming weeks and months, as this could help us gain in efficiency.
Of course, in the coming months, I will continue to work in full confidence and transparency with the Member States and the European Parliament.
Ladies and gentlemen,
To be clear: Our lack of progress in this negotiation is not due to our method, but to the substance.
We must stick to our commitments if we want to move forward!
We engaged in this negotiation on the basis of a joint Political Declaration that clearly sets out the terms of our future partnership.
This document is available in all languages, including English. It is a good read, if I may say so.
This declaration was negotiated with and approved by Prime Minister Johnson.
It was approved by the leaders of the 27 Member States at the European Council in October 2019. It has the backing of the European Parliament.
It is – and it will remain for us – the only valid reference, the only relevant precedent in this negotiation, as it was agreed by both sides.
Yet, round after round, our British counterparts seek to distance themselves from this common basis.
Let me give you four concrete examples, referring precisely to the text of the Political Declaration:
1. Prime Minister Johnson agreed, in paragraph 77 of the Political Declaration, that ‘given our geographic proximity and economic interdependence’, our future agreement must encompass robust commitments to prevent distortions of trade and unfair competitive advantages. This is what, together, we chose to call the ‘level playing field’.
• In this paragraph, Prime Minister Johnson agreed to uphold the common high standards applicable in the Union and the UK at the end of the transition period in these areas: state aid, competition, social and employment standards, environment, climate change, and relevant tax matters.
• We are today very far from this objective.
2. Prime Minister Johnson agreed, in paragraph 66 of the Political Declaration on civil nuclear cooperation, to maintain our existing high standards of nuclear safety.
• We are very far from this objective.
3. Prime Minister Johnson agreed, in paragraph 82 of the Political Declaration that our agreement should cover anti-money laundering and counter terrorism financing.
• We are very far from this objective.
4. Prime Minister Johnson agreed, in paragraph 118 of the Political Declaration, to base our future relationship on an overarching institutional framework, with links between specific areas of cooperation.
• We are, once again, very far from this objective.
In all these areas – and many others – the UK continues to backtrack on the commitments it has undertaken in the Political Declaration.
Including on fisheries, where we committed to use our “best endeavours” to conclude and ratify a new agreement by 1st July 2020.
It seems clear that we will not reach this target considering how the negotiations in this area are going for the moment.
Even in the rare areas where we saw some movement this week, such as the European Convention on Human Rights, we still fall short of what we had agreed in the Political Declaration.
Finally, let me remind you that, since the beginning of these negotiations, the UK has refused to talk about our cooperation on foreign policy, development and defence, even though we agreed this with Boris Johnson in the Political Declaration.
To tell the truth – as a former Minister for Foreign Affairs in my own country – I still don’t understand why.
 
Ladies and gentlemen,
We cannot accept this backtracking on the Political Declaration.
And we will request the full respect of the Withdrawal Agreement.
On citizens’ rights, we continue to be extremely vigilant.
There have been frequent exchanges of information between Vice-President Maroš Šefčovič and Michael Gove on this topic.
Regarding EU citizens residing in the UK:
• We are pleased to hear that 3.1 million EU citizens have already been granted residence status.
• And we are carefully monitoring the situation of more vulnerable citizens that have difficulties applying digitally.
• It is also important that EU citizens residing in the UK have access to social benefits in these difficult times.
As for UK nationals residing in the EU:
• In the 13 Member States that – like the UK – have chosen a constitutive system, we are working to ensure that procedures for applying for residence status are simple, easily accessible, and clearly communicated;
• In the 14 Member States that have chosen a declaratory system, UK nationals will receive a physical document enabling them to prove their status.
We also continue to be extremely vigilant with regard to the correct implementation of the Protocol on Ireland and Northern Ireland.
• The UK Command Paper published on 20th May is useful.
• But there are still a lot of details to be settled if we want to move from aspiration to operation, in line with the legal Treaty.
• Furthermore, some of the objectives set out in this Command Paper – such as avoiding exit declarations on goods moving from Northern Ireland to Great Britain – are incompatible with the legal commitments accepted by the UK in the Protocol.
• So we really need to work more on the technical details.
Only a precise and rigorous implementation of the Withdrawal Agreement can create the confidence we need to build our future partnership.
The 27 Member States and the European Parliament have been very clear about this, including in our negotiating mandate.
 
Ladies and gentlemen,
In the coming days, the Commission will have the opportunity to take stock with the 27 Member States, the President of the European Council Charles Michel, as well as with the European Parliament, its President David Sassoli, and the coordination group chaired by David McAllister.
The month of June will also see the second meeting of the Joint Committee – on 12 June – and the High Level Meeting that we agreed to in the Political Declaration to take stock of these negotiations.
We still need to decide on the date and the modalities of this meeting. This is also the case for the next rounds – the first of which would probably take place towards the end of June or early July.
But it is clear that we are approaching a moment of truth: We expect the United Kingdom to respect its engagements – both when it comes to our, already ratified, Withdrawal Agreement, and to the precise content of the Political Declaration, which remains and will remain the basis and the framework for our negotiation.
If this is the case, and if we keep our mutual respect, our serenity and our determination, I have no doubt that we will find, in the course of the summer or by early autumn at the latest, a landing zone between the United Kingdom and the European Union. Then, finally, we will reach an agreement on our partnership for the future.
Compliments of the European Commission.