C 153/4
EN
Official Journal of the European Union
7.4.2022
(11)
Although the rise in bankruptcies has remained limited so far, the COVID-19 crisis has left many firms with weaker balance sheets, which might constrain their ability to finance investment projects in the near term and compromise their repayment capacity.
As the recovery takes hold, support should be gradually phased out and made more targeted.
Making less use of debt instruments would limit contingent liabilities and help preserve businesses’ investment capacity.
Timely withdrawal of policy support measures is a balancing act involving supporting investment and employment and avoiding failures of viable businesses, without inhibiting the orderly exit of unviable businesses over the medium-term.
In this context, improving access to finance for companies, strengthening firms’ balance sheets and enhancing the capacity and efficiency of insolvency frameworks is crucial.
National insolvency regimes differ substantially across the euro area, and capacity-enhancing actions will be needed to facilitate an effective administration and judicial system.
Improving insolvency frameworks can also contribute to sounder balance sheets in the banking sector, with a positive impact on credit supply.
Directive (EU) 2019/1023 of the European Parliament and of the Council (6) on restructuring and insolvency, which seeks to introduce minimum standards across Member States on preventive restructuring and debt discharge for entrepreneurs, is to be transposed into national law by 17 July 2022.
Moreover, the integration of the Union’s capital markets is key to providing companies with alternative sources of funding to complement bank lending.
Progress in the Capital Markets Union can improve access to finance for euro area businesses, mobilise long-term investments in new and in green technologies and infrastructure, promote equity investment and remove cross-border barriers to investment, including by harmonising certain aspects of substantive law on insolvency proceedings.
(12)
While employment is recovering rapidly, some sectors, specific categories of workers and regions are set to be impacted in the long-term by the COVID-19 crisis and by the strong push for greening the economy and accelerating digitalisation.
Young people have been particularly affected, as well as low-skilled people and people with a migrant background.
The new jobs being created could be different from those jobs lost due to that crisis.
Some groups, including women, still experience structural challenges in labour market integration.
Supply chain bottlenecks and surging energy prices may slow down the rebound of employment in certain sectors.
Policy measures that facilitate job transitions and labour market re-integration will therefore be key to supporting adjustment and mitigating the social impact, in particular in light of the green and digital transitions.
The Commission put forward Recommendation (EU) 2021/402 (7) on an effective active support to employment following the COVID-19 crisis, inviting Member States to develop coherent policy packages combining measures that aim to bridge skill shortages and help individuals to successfully navigate the green and digital transitions.
Such packages would consist of three components: (i) time-limited and well-designed hiring and transition incentives and support to entrepreneurship; (ii) upskilling and reskilling opportunities linked to labour market needs; and (iii) enhanced support by employment services.
Meanwhile, for the cohesiveness of the euro area, social protection remains fundamental in the wake of the health and economic crises to ensuring fair green and digital transitions.
The European Pillar of Social Rights remains the compass for employment, skills and social policy action, fostering upward economic and social convergence and better working and living conditions in the Member States.
The European Pillar of Social Rights Action Plan, adopted in March 2021, sets three Union headline targets on (i) employment, (ii) adult learning and (iii) poverty reduction by 2030, to which relevant policy actions will contribute.
Those targets were welcomed by Union leaders at the 8 May 2021 Porto Social Summit and in the European Council on 24–25 June 2021.
(13)
Member States have designed ambitious reform and investment plans, with the financial and policy support of the RRF, and their implementation is key.
Increasing the quality of institutions, in particular by strengthening administrative capacity, will be key to ensuring a swift absorption of the related funds while avoiding duplication of and interference with other Union instruments.
Member States can improve the framework conditions for private investment by improving the business environment.
Preserving and strengthening supply chain resilience in the single market by detecting and addressing supply shortages and bottlenecks, in addition to open markets, convergence in standards, and greater diversification, circularity and resource efficiency, will be key to ensuring the smooth functioning of the single market.
The Council Recommendation of 13 July 2021 on the economic policy of the euro area, which calls for further integration of the single market for goods and services, including the digital single market, by removing unnecessary restrictions, enhancing market surveillance and guaranteeing sufficient administrative capacity, remains relevant.
(6) Directive (EU) 2019/1023 of the European Parliament and of the Council of 20 June 2019 on preventive restructuring frameworks, on discharge of debt and disqualifications, and on measures to increase the efficiency of procedures concerning restructuring, insolvency and discharge of debt, and amending Directive (EU) 2017/1132 (Directive on restructuring and insolvency) (OJ L 172, 26.6.2019, p.18).
(7) Commission Recommendation (EU) 2021/402 of 4 March 2021 on an effective active support to employment following the COVID-19 crisis (EASE) (OJ L 80, 8.03.2021, p. 1).