The ongoing Covid-19 crisis affects all European economies, however the crisis causes much more economic damage in some member states than in others. A joint European policy response to share the fiscal burden of this crisis is, therefore, urgently needed. This Policy Paper by Dr. Nils Redeker analyses to what extent these costs are likely to differ across member states and how governments are trying to mitigate them. This initial analysis suggests two important takeaways that need to be considered. First, economic vulnerabilities differ substantially across member states. Second, initial fiscal crisis responses, so far, do not seem to match the distribution of economic risks. Nevertheless, crisis measures need to converge swiftly or else risk aggravating economic disparities across member states as well as seriously harming the European recovery.
Natascha Hainbach is Junior Project Manager of the Bertelsmann Stiftung's Europe Future programme.