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Week Ahead (17 May)

W/C Monday, 17 May - Talks on digital green certificate to continue

Following last week's talks between European Council and Parliament negotiators on proposals for a digital green certificate which would allow holders to travel within Europe, the Portuguese presidency of the European Council will push for a final resolution this week.  The proposals aim to open European holiday destinations for business ahead of the summer season. 

Little progress was reported in the aftermath of last week's talks, with differences in the positions adopted by the European Parliament and member states on the scope of the proposed certificate a cause for concern.  Parliament is advocating for free testing and the dropping of all restrictions for certificate holders throughout the EU, while member states are insisting on being able to vary conditions on a country-by-country basis. 

The Portuguese presidency of the Council has said that it hopes to conclude a deal on the certificates this week, although it is understood that an agreement is more likely to be achieved by the next European Council meeting at the end of May.  If no agreement is reached by then, leaders will take over and it is understood that the matter will be passed as a Council recommendation.

Monday, 17 May - ECON/ENVI committees of European Parliament to discuss taxonomy regulation

MEPs from the Economic and Monetary Affairs and the Environment, Public Health and Food Safety Committees will today debate the new taxonomy regulation with the European Commissioner for Financial Services, Financial Stability and Capital Markets Union, Mairead McGuinness. On 21 April the Commission adopted in principle a delegated act - the taxonomy regulation - which specifies the activities funds and banks are allowed to market to investors as environmentally sustainable.   Officials said that the act will affect the economic activities of 40% of listed companies in the EU which account for 80% of greenhouse gas emissions in the bloc. 

Future delegated acts will deal with nuclear, agriculture, bioenergy and forestry, while a separate legislative proposal on the funding of natural gas investments has also been mooted.  The taxonomy act must now be approved by both the European Parliament and Council, where considerable opposition to any link between nuclear and green energy is anticipated.

Tuesday, 18 May - Finnish Parliament to vote on the passing of own resources measure

The Finnish parliament spent much of the last week debating the "own resources" decision required to approve the new multiannual financial framework and recovery fund. A vote on the matter was due to take place on Wednesday. However, the nationalist Finns Party, which opposes the measures, seized on comments made by EU officials to the effect that the recovery and resilience fund could become a permanent mechanism to extend the debate. Parliament sat until 4 am on Wednesday morning before being suspended by the speaker of the house. The debate concluded on Saturday, paving the way for a vote on the issue on Tuesday.

The government controls 117 seats in the 200-seat parliament, meaning that opposition support will be required to achieve the two-thirds supermajority. It is hoped that the National Coalition Party, which controls 38 seats in opposition, will abstain in order to ensure the legislation is approved.   

Tuesday, 18 May - Flash estimates of GDP and employment in Q1 2021 to be released

Eurostat will release its latest statistics on GDP and unemployment on Tuesday.  The release will show economic conditions during the first quarter of 2021, during which Europe reckoned with Brexit and a new wave of Covid-19.

The previous batch of data show that eurozone growth fell by 0.7% in Q4, with a decline of 0.5% in the EU as a whole when compared with the previous quarter.  This contrasts sharply with Q3, when eurozone GDP rose by 12.5% on the back of the re-opening of the economy. In the EU as a whole, GDP rose by 11.6% in Q3 2020.  The results for Q1 2021 are likely to show further declines in GDP as a result of conditions which saw the entire services sector across the bloc grind to a halt.

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