Ref. Ares(2021)292979 - 13/01/2021
PRIORITIES FROM CIP
Ref. Ares(2021)292979 - 13/01/2021
1
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
PRIORITIES FROM CIP
CONFEDERATION OF PORTUGUESE BUSINESS
PORTUGUESE PRESIDENCY
OF THE COUNCIL OF THE EU
January 2021
2
PRIORITIES FROM CIP
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
PRIORITIES FROM CIP
3
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
MESSAGE FROM
THE PRESIDENT
António Saraiva
Portugal will hold the Presidency of the Council clearly insufficient, in face of a situation that has
of the European Union at a very difficult moment. been dragging for several months now.
The COVID-19 pandemic generated a health crisis
and, with it, serious and long-lasting social and At European level, funds from the European recovery
economic consequences worldwide. Furthermore, plan must be channelled into the real economy
we are witnessing, as a result, permanent changes as soon as possible. But not all is about financial
in work relations, in the way companies’ function, support: more than ever, companies must be spared
on how supply chains are organised, on how trade from unnecessary administrative and compliance
is constructed. In some cases, the pandemic has costs, existing barriers in the EU single market must
only accelerated existing trends. In others, we are be addressed, and a level playing field ensured.
witnessing disruption.
CIP supports the priorities of the Portuguese
The European Union must be ready to face the new Presidency: to achieve a resilient Europe, a social
order. We need solid actions to address the post- Europe, a green Europe, a digital Europe, and a
pandemic world.
global Europe. The question is HOW to achieve these
goals. In this paper, we present our views in these
Companies must be placed at the centre of the five broad areas, and share recommendations as
recovery. Business have revealed major responsibility, well as concerns from the business community.
managing to broadly maintain employment over the
initial COVID wave, and have demonstrated creativity I wish you a pleasant reading.
and flexibility in adapting to the situation. However,
many have collapsed, and many more are using all Yours sincerely,
available reserves to stay afloat. Public support, so
far, has been welcomed and well targeted. But it is
António Saraiva
4
PRIORITIES FROM CIP
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
PRIORITIES FROM CIP
5
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
INDEX
1. A RESILIENT EUROPE 6
2. A SOCIAL EUROPE 7
3. A GREEN EUROPE 9
4. A DIGITAL EUROPE
10
5. A GLOBAL EUROPE 12
6
PRIORITIES FROM CIP
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
1. A resilient Europe
Europe has been seriously hit by the pandemic. The EU economy is expected to fall by 7,4% in 2020 and
bounce back by 4,2% in 2021 and 3% in 2022. Output in the EU is expected to only recover its pre-pandemic
level in 2022. By then, many companies will have closed its doors and many jobs will be lost.
With the vaccination against COVID, a progressive return to normal life will be possible over the coming
months. But it will take time until economic activity can fully resume. Most companies have used all
available reserves to stay afloat, and it is therefore necessary that measures to support businesses and
workers are not prematurely unwind.
• The European recovery funds must reach the concept, avoiding distortions and misconceptions. We
real economy without delay: With a welcomed deal stress the need to continue implementing the necessary
reached by the 10 December European Council on the horizontal conditions for all companies and all sectors
Multiannual Financial Framework and Next Generation to flourish and to be part of the solution, attracting
EU, it is now absolutely necessary to ensure funds reach investment and companies’ comeback.
the real economy quickly.
• Deepening the economic and monetary union: It
Speed must however not compromise quality. National is particularly important to accelerate the work to
Recovery and Resilience Plans must effectively direct reach a full Banking Union, in its three pillars, with the
resources, not only in view of the recovery, but also rapid establishment of a European Deposit Insurance
ensuring a vision for the future. This unprecedented Scheme and assuring that the common backstop to
amount of EU funds must be used to transform our the Single Resolution Fund can start operating at the
economies and improve their resilience. National social beginning of 2022, as agreed last November by euro
partners must be fully involved. Investment in education, area ministers of finance.
training, and our youth, must be a priority bearing in
mind the need to adapt the skills and the training system
to the new reality. Young people are definitely the ones
• Ensure a quick finalisation of the cohesion policy
who will suffer the most in the near future.
files and a swift start of programmes: The importance
of cohesion policy for all EU countries is increasingly
• Industrial policy: The way the EU will position itself recognise, and this policy proved of fundamental
in the world in the medium to long term, is dependent importance when the pandemic crisis hit – it was
on the decisions it takes today regarding its industrial possible to quickly mobilise cohesion funds and redirect
strategy. The crisis has exposed fragilities regarding programmes to quickly act where needs became more
the way our value chains are organized and, if we are to pressing. It is now of fundamental importance for the
find responses to societal challenges, then we need to Presidency to bring to a speed conclusion the legislative
ensure excellence in its industry, in its human resources, dossiers to allow for operational programmes to
and associated services. The definition of industrial start as soon as possible. We cannot delay important
ecosystems should be revised, coherently with its base investments that can be done through these funds.
PRIORITIES FROM CIP
7
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
• Investment: We have witnessed a massive fall in
• Ensuring a level playing field within the EU
private investment in recent months. We must pursue
Single Market: We believe the temporary state aid
public policies supporting the overall investment framework, relaxing existing rules in response to the
levels or we will never be able to achieve the so wished crises, was a necessary decision. But this is creating
leadership in the digital and green transition. It is also major imbalances given the wide differences in the
important to progress towards the capital markets ability of different Member States to provide support
union and to take measures to make it easier for capital to their companies. These imbalances clearly distort
markets to support economic recovery. The better competitive conditions in the internal market and will
regulation agenda is crucial to recover the investment have to be monitored and corrected. We must ensure
climate at EU and national levels, and the quality of these measures will not undermine the level playing
impact assessments must be improved.
field in the single market in the medium to long term.
• Address existing barriers in the EU Single Market: • Taking into account SMEs: SMEs play an important
The Portuguese Presidency must relaunch the agenda role in the EU economy and so also in the EU economic
for the internal market, lift barriers imposed during recovery. All EU policies targeting companies in
the pandemic, and continue working to eliminate pre- the Single Market should take into account SMEs’
existing barriers. In particular, we must tackle long- vulnerabilities, namely within the EU present driving
standing obstacles to cross-border labour mobility, forces of sustainability and digitalization. Other EU
address regulatory barriers for cross-border provision policy domains, such as access to finance, better
of services, address the over-prescriptive Commission’s regulation and internationalisation, should also regard
policy for harmonised European standards for goods, SMEs as a specific target, while applying adjusted/
and remove barriers to the free flow of data.
specific measures.
2. A social Europe
Job losses and the rise in unemployment has been contained compared to the drop in economic activity,
according to the latest available forecast from the European Commission. Companies have made
remarkable efforts in maintaining employment, supported by government measures, which helped
cushion the impact of the pandemic in labour markets. This being said, unemployment is still expected
to rise to a maximum of 9,4% in 2021, and the social consequences from the pandemic are already
visible.
We must ensure a strong, sustainable and inclusive recovery. We need to make the most of innovative
and flexible solutions that allow active labour market policies, to promote redeployment of workers
from more affected sectors to others which suffer labour shortages. Measures to be adopted must take
into consideration the difficult moment that private companies, the main source of job creation, are
facing and therefore avoid additional burdens. A business-friendly environment is needed, now more
than ever.
8
PRIORITIES FROM CIP
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
• The European Commission’s proposal for a directive information and consultation and social protection.
on minimum wages and collective bargaining in the The informal meeting of EU leaders regarding the
European Union promotes disunity: Such proposal Social Pilar in May in Porto must take in mind the
is contrary to the letter and spirit of the EU Treaty, as inputs of the civil society organizations in a balance
these matters are the responsibility of Member States way. And the outputs of the meeting should be clear.
and Social Partners in accordance with the principle of
subsidiarity. The proposal disrespects the diversity of
• Respect the autonomy of social dialogue: The
existing industrial relations systems, the autonomy of existence of active and responsible Social Partners,
the Social Partners and goes against the strict division of with national or supra-national objectives in the
competences between the EU and the Member States.
design and implementation of solutions is critical
for the survival and development of companies
The proposal will further promote the division between and, consequently, employment, as well as for the
Member States, especially in a time of crisis where sustainability and growth of the economy.
unity and cohesion are required, and is contrary to the
majority opinion of Member States who are in favour The implementation of such solutions must respect
of a non-binding instrument, i.e. a recommendation.
the competences of the EU and the Member States
and adequately involve the European and national
The choice of a legally binding text, as is the case social partners. In this context, the Portuguese
with a Directive, means that Member States will Presidency must ensure that the Action Plan for the
have to transpose it to the national level, and the implementation of the European pillar of social rights
European Court of Justice will therefore have recognise that the main responsibility for the delivery
jurisdiction over exclusively national collective of its principles lies in the hands of Member States.
agreements, thus undermining a fundamental feature
of the best performing social dialogue systems in It is also important to respect and give space for
Europe: independent collective bargaining between solutions created by social partners as well as by
organizations representing employers and unions.
individual companies and workers to find the best
solutions to their needs. In other words, it is crucial to
• Realism is required in the Action Plan for the respect the autonomy of social dialogue.
implementation of the European Pillar of Social
Rights: CIP naturally supports Social Europe and the
• Improve preparedness of Health Systems to
need to promote measures that respond to the current
respond to public health threats: The covid-19
crisis. However, the support and development of such pandemic has shown that vulnerable and fragile
a Model depends on improving the performance of health systems result in inadequate health responses
labour markets and social systems in all Member with consequences on social cohesion and economic
States, giving the necessary and natural space to the growth. Investment in health is needed to strengthen
solutions achieved by social dialogue at community the capacity of health systems to provide effective
and national levels.
patient care and reduce the pressure on health
systems. This can be achieved through investment
The Action Plan cannot ignore that the economic in primary care and collaborative models of care,
dimension is essential to ensure the European Social fostering interprofessional and inter-sectoral
Model. Europe’s social problems are not due to a deficit collaboration in several areas such as vaccination,
in social policy, but to a lack of competitiveness. It is non-urgent health situation and chronic diseases,
necessary to bear in mind that the EU social acquis among others.
is already well developed, covering more than 70
Directives that protect workers and give them rights While respecting the subsidiarity of Member
in several key areas, including, among others, equal States, building a strong European Health Union
treatment, working conditions, health and safety, can contribute to find new and innovative solutions
PRIORITIES FROM CIP
9
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
to better prepare health care systems, improve the integrity of the pharmaceutical chain, from
people’s health, and promote a sustained economic production to dispensing.
recovery. More than ever, resilient, and sustainable
pharmaceutical supply chains are key to ensure A top priority is the digital transformation of the
timely and safe access to medicines and vaccines.
health sector, including telemedicine and the
interoperability of electronic health records, as a key
Financing and pricing policies must be balanced to improving the quality of healthcare and increasing
and incorporate in its objectives affordability and access to healthcare. As such, the High-Level
accessibility factors, as well as the sustainability Conference on Digital Health (Portugal eHealth
of the pharmaceutical chain. This must be Summit) which will be held in June, in Lisbon, is
addressed in the Pharmaceutical Strategy for expected to be one major event of the Portuguese
Europe. There is an urgent need to preserve Presidency.
3. A green Europe
The objectives of the Green Deal and the aim of reaching climate neutrality by 2050 are as relevant as ever.
CIP believes there are important opportunities to be explored from the green economy. However, it must
take into account the effects of the crisis in the capacity of companies to act, reinvent themselves, and
invest.
We must balance our ambitions against the new reality. The way we will accomplish the green transition
must take into consideration an economy in tatters. Targets must be realistic to be meaningful, and we need
to have an adequate strategy with the right instruments and framework in order to reach them. We must
also underpin the Green Deal and its new targets with a credible industrial strategy.
• The success of the Green Deal and its new targets well sustained review of the Effort Sharing Regulation,
depend strongly on reaching a credible industrial so that the efforts demanded for each Member State
strategy that can restore the company’s capacity are just and possible, taking account of the previous
to invest in green and low carbon technologies. To commitments and real achievement trends.
become climate-neutral in a cost-effective way, we
must ensure that there is enough affordable green
• To preserve the EU companies’ competitiveness,
energy available: namely improving the development
we need to have effective carbon leakage
of the essential interconnections and improve the
measures: this means that should a Carbon Border
EU level playing field regarding carbon emissions Adjustment Mechanism (CBAM) be introduced, it must
reductions, between industry, energy, buildings, and be done so in a complementary way to existing ETS
transport activities, whilst working for more ambition carbon leakage protection measures and in a fully
from third countries. The new and more ambitious WTO-compatible way, to ensure the impact of both
EU target on decarbonisation for 2030, needs a very imports and exports.
10
PRIORITIES FROM CIP
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
• Promote a strong and real dialogue with • Promote the development and successful
European industry: this is particularly important in
implementation of the sustainable finance
the preparatory phase of the numerous legislative
agenda: criteria and disclosure obligations from
initiatives foreseen in 2021, such as the revision of the taxonomy regulation should be proportionate,
ETS, the Renewable Energy Directive, the Energy practicable and fit for purpose. These should be
Taxation Directive, the Energy Efficiency Directive, broad enough to ensure that activities with no
the Eco-design Directive, and the Industrial direct impact on low carbon goals but having an
Emissions Directive.
indirect and important role in several value chains
essential for the green transition, are taken into
• The new Circular Economy Action Plan must account. It is also essential that lessons are drawn
deliver a functioning market for quality secondary from the just-adopted (and not yet implemented)
raw materials and circular products: without taxonomy, before considering using this private-
raising more bureaucracy, especially for SMEs, sector tool for other purposes such as EU funding
in terms of compliance with new reporting and instruments or policies.
communication platforms such as SCIP or setting the
right methodology for substantiating green claims.
4. A digital Europe1
It is essential to ensure that Europe is on an equal footing with other global competitors. Without an adequate
legislative environment, the right skills and the necessary investments in very high-speed broadband
infrastructure, Europe will continue to lose prominence in this crucial sector of the economy.
We need to support the digital transformation of our economies and societies by creating the conditions
for the safe deployment of new technology such as AI and 5G as well as for the industrial data economy,
developing digital skills and incentivising voluntary data sharing through collaborative European data
spaces. Europe must be able to compete with other world leaders in these critical technologies.
It is time to reinforce Europe as a relevant digital player in the global economy, supporting an innovative and
business-oriented ecosystem, but also leveraging a European approach funded on openness to different
cultures and new markets. That would mean new opportunities for European companies – notably SMEs –
to find new markets and to attract technology and capital. We need an autonomous Europe opened to the
World. Due to its historical and cultural heritage and to its global multicultural and political background,
Portugal can play a very important role bridging European values to constructive partnerships.
PRIORITIES FROM CIP
11
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
The European Union has an important role to play in coordinating a common approach to the challenges
of digital transformation and in the development of a true Digital Single Market, which will enable it to
successfully face the challenges of globalization and facilitate the development of this market, both on the
supply and demand. As for an adequate taxation system for the digital age, it is essential that any proposals
in this area are agreed internationally within the framework of the OECD.
1 Some policy messages from this section reflect BusinessEurope’s own position, which CIP fully endorses.
• A risk-based AI framework that would focus on out activities that impede effective competition.
where the highest and most widespread societal Contestability of these platforms by others through
damage is likely to arise: We agree with the truly open markets should be the goal. Clarity as to
Commission’s two-step test of defining high-risk in which platforms are considered “gatekeepers” as well
its White Paper, yet believe immaterial risks, as too as the criteria as to how these characteristics should
broad a concept to legally define or otherwise covered be measured are required.
by existing legislation, should not feature in the final
definition. Only material risk (death, injury and property
• Implementing 5G: 5G technology is a great
loss) should feature. We also have strong reservations opportunity, if properly used, for the consolidation of
in relation to “exceptional instances” as defined by the an innovative and strong national business ecosystem,
Commission which seem to negate the entire benefit leveraged by the multiple and promising applications
and legal clarity of this two-step test.
of this technology in the different domains, whether
in business reinforcement, reindustrialization,
• Support the Data Governance Act: it is important digitalization of all sectors, namely retail and
to incentivise more data sharing between businesses distribution, logistics or the food supply chain that
and further opportunities to re-use public sector data. involves producers and a series of actors that can
Businesses need legal clarity, standards supporting benefit greatly from the investment. The public sector
interoperability and affordable data sharing agreements itself, at central, regional, and local levels, should
that either monetise data provider participation or enable leverage the potential of 5G to accompany and mobilize
“give and take” schemes for this initiative to be a success. a modernization effort that best serves citizens. Any
climate of conflict and litigation around this theme
• Start discussions on the Digital Services Package: must be overcome in order to take full advantages of
including clear, fast and harmonised notice and the potential of 5G.
takedown provisions to support the removal of illegal
goods and content online. Further, novel measures,
• Fair competition and clear rules: Digital market and
such as transparency reporting, “know your business online platforms are part of a new economy. These are
customer” and new enforcement powers to regulators crucial for Europe, but there is the need to set clear and
should be considered to incentivise platforms into fair rules. Characteristics such as vertical integration,
maintaining diligent processes of active engagement. lack of transparency for users, lock-in and network
The notion of legal but “harmful” content should not effects coupled with high concentration levels result
be defined or legislated for at the risk of breaching in structural competition problems, affecting both
fundamental rights. Platforms achieving a so called consumers and workers. The Portuguese Presidency
“gatekeeper” position are not necessarily abusing that must see the Digital Services Act as an opportunity to
position. However, it can take place through carrying complete the process in order to boost competition.
12
PRIORITIES FROM CIP
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
5. A global Europe
Europe must continue to drive international free trade, with an ambitious negotiation agenda, fighting
protectionism. We must promote effective implementation of existing trade agreements and ratification of
agreements that have been concluded such as the one with Mercosur. The EU also has a key role to play
in the process of globalization, in order to ensure that the benefits are well distributed and to reinforce the
capacity of Member States and their companies to face global competition. Acting together, the EU and
their Member States have the necessary capabilities and means to find solutions to problems and make a
difference globally.
• Trade: EU Trade policy will have an ambitious – Mercosur, Africa and India – should be firmly targeted.
international trade agenda. The objective is to increase
access to third markets and, on the other hand,
• Rapid ratification of the EU-Mercosur agreement:
ensuring that products, services, and investments We need a rapid ratification and implementation of
entering the EU market do not create distortions of the agreement between the EU and Mercosur, as a
competition, either because their origin is subsidized further delay can jeopardise the full potential of the
and/or because they do not meet EU standards. While opportunities given by the agreement. The completion
these cases of distortion affect EU companies, the of the largest agreement ever concluded by either the
EU has to reinforce its Trade Defence Instruments, European Union or Mercosur will give the two regions
and complement them with the future instrument to the opportunity to overcome the difficulties we are
address foreign subsidies.
experiencing, but also to project the future beyond the
pandemic. Implementing the new agreements with
The success of trade policy strongly depends on a well- Mexico and Chile would complete the most needed
regulated trade framework at world level. It’s essential stronger ties with Latin America.
that the EU gather all its efforts and all its partners
around the reform of the World Trade Organisation.
• Further deepening EU Africa relations: 2021 is
expected to be a decisive year for EU-Africa relations
It is important to ensure the right revision of the through the adoption of a partnership with the
Generalized System of Preferences (GSP) scheme. African Union, after the postponement of the last EU-
This revision should, on one hand, adjust the GSP Africa summit due to COVID. Africa is facing its first
criteria enabling a better distribution of benefits – recession in 25 years because of the effects of the
more on least developed countries and less on mono- pandemic, which will affect the goals for sustainable
producer countries that have reached top world market development (SDG). Promoting trade and investment
shares and, on the other hand, make GSP+ beneficiary in and with Africa must be a priority to truly deliver
countries comply with international conventions on on growth, jobs, and sustainable development. In this
environment and climate change.
context, regional economic integration through the
African Continental Free Trade Area (AfCFTA) and the
Ensuring a global Europe implies focusing trade and Economic Partnership Agreements (EPAs) should be
investment policies in the relationships with the EU put high on the agenda, as well as the post-Cotonou
most important partners – US, China, and UK – each agreement between the EU and the Organisation of
representing different kinds of challenges. Other African, Caribbean and Pacific States (OACPS). EU
relationships representing today a significant potential external financing instruments must be well known
PRIORITIES FROM CIP
13
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
to companies as private investment in areas such as for our companies, combining good market access with
infrastructures, connectivity and energy is key to create a level playing fields will be a permanent objective. It is
more and better jobs in Africa. Education and training important to address main disruptions after 1 January
have to be a priority to meet the local market needs of 2021, for which a strong cooperation with business will
skilled labour.
be needed.
• Support the greater engagement between the EU • Open Strategic Autonomy must be pursued
and India: The next EU-India Summit in May in Porto is
by market forces and reject protectionism: The
an opportunity to reaffirm both sides commitments to pandemic alerted for the weaknesses of the system
multilateralism and to launch firm basis for EU-India due to an excessive rigidity characterized global value
cooperation in trade and investment.
chains and made evident the excessive dependencies
in certain sectors or in relation to certain countries. In
• Relaunch the transatlantic agenda: We must seize the its efforts to ensure “strategic autonomy”, Europe must
opportunities that the new US presidency raises to renew not close itself. We need to have companies that can
and improve the EU-USA relationship, and deepen the lead in areas called strategic, but this process must be
transatlantic agenda in terms of trade and investment.
conducted by market forces and not predetermined by
governments.
• Approaching China: Europe should aim at reinforcing
the economic ties with China, while levelling the In the new revised EU Trade Strategy, the European
playing field. The ratification of the recently concluded Union must continue to lead by the example it sets
Comprehensive Agreement on Investment and the in terms of action and the values it defends. It cannot
implementation of the Geographical Indications yield to protectionist tendencies, which will inevitably
Agreement should be the main objectives.
close its foreign markets, nor allow an international
order that encourages indiscriminate subsidizing
• Continue working on the EU-UK relations: The UK will practices by companies. Europe has a responsibility to
always be an important EU’s economic partner. Within lead this process, persisting in a commercial strategy
the framework of the EU-UK Trade and Cooperation of opening up to the world, framed by prudent rules
Agreement, concluded on the 30th December 2020, the and appropriate internal policies, within the framework
pursuit of the best possible competitive environment of its Recovery Plan.
A
CIP – CONFEDERATION OF PORTUGUESE BUSINESS represents more than 150.000
enterprises, which employ 1,8 million employees and generate a summed turnover
equal to 71% of the Portuguese GDP.
CIP is a national social partner and the most representative Employer’s Association
in Portugal, firmly committed to champion progress and well-being in Portugal.
CIP integrates the following international organisations:
Organização Internacional do Trabalho
International Labour Organization
PRIORITIES FROM CIP
15
PORTUGUESE PRESIDENCY OF THE COUNCIL OF THE EU
Brussels Office
Avenue de Cortenbergh, 168, 6ème étage 1000
Brussels
Belgium
@cip.org.pt