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Healthcare

Massive German state aid to virus-hit firms? Others in EU doing as much or more -Vestager

BRUSSELS, Feb 8 (Reuters) - Concerns that Germany may have an unfair competitive advantage because of billions of euros pumped into its virus-hit companies are not backed by data which show other EU states doing as much if not more for their businesses, Europe’s antitrust chief said.

Since the start of the COVID-19 pandemic last year, European Union Competition Commissioner Margrethe Vestager has approved 3.1 trillion euros ($3.7 trillion) in state aid to airlines, restaurants, farmers, entertainers and others across the 27-country bloc suffering from the economic hit of COVID-19.

Germany accounts for 51% of the total approved aid to date, trailed by Italy with 14.7%, France at 13.9% and Spain at 4.8%.

That has triggered concerns among some EU countries that German aid may tilt the level playing field, giving companies in Europe’s largest economy an unfair advantage.

Vestager, in an interview with Reuters on Monday, cautioned against reading too much into the approved sums versus the amounts that were actually disbursed by EU governments.

“What we saw when we looked at the funds paid out, we saw quite a different pattern. And this is of course why it is really interesting to see what are the real sums that are being paid out,” Vestager said.

“Germany paid out about 25-27% of the total (approved) aid paid out, France more or less the same, maybe a little bit more actually, then Spain and Italy. So you get a much more nuanced picture when you look at the actual spending,” she said.

Vestager was referring to the period between mid-March and end June last year when she gave the green light to 2.3 trillion euros in state aid, of which 354 billion was paid out.

Of this total, France disbursed 123 billion, Germany 96 billion, Spain 65 billion and Italy 26 billion.

In relative terms, the Spanish payout amounted to 5.3% of its gross domestic product, France’s figure was 5.1%, Poland 2.9% and Germany 2.8% in the same period.

“I think it is important because it shows that the worries a lot of people had about a complete fragmentation of the single market, of course it is good to have that worry, but also when you look at the nuance, it is not a given that the worry will actually materialise,” Vestager said.

The European Commission is now seeking the latest data from EU countries on their disbursements to get a more comprehensive picture.

$1 = 0.8296 euros Reporting by Foo Yun Chee Editing by Mark Heinrich

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