EFTA ECOFIN Ministers take stock of challenges and opportunities in wake of pandemic

EFTA and EU Ministers of Finance and Economy met in Brussels on 9 November, to take stock of the economic challenges and opportunities that are emerging in the wake of the COVID-19 pandemic.

The EFTA countries were represented by Iceland’s Permanent Secretary of the Ministry of Finance and Economic Affairs Guðmundur Árnason (Chair); Liechtenstein’s Prime Minister and Minister for Finance Daniel Risch; Norway’s Deputy Minister of Finance Erlend Trygve Grimstad; and Guy Parmelin, President of the Swiss Confederation.

“Winston Churchill once said that an optimist sees opportunity in every difficulty. It is fair to say the EFTA States are optimists. We perceived the COVID-19 pandemic as an opportunity to foster structural change; to make our economies greener, more inclusive, and resilient to future shocks,” Chair Guðmundur Árnason said on behalf of the EFTA States.

Further, Árnason underlined the efficacy of the economic response to the pandemic from the EFTA States. A response that had been unprecedented but at the same time “sizeable, timely and targeted”.

However, Árnason noted, the pandemic will certainly leave us with a changed economy. “Once the fiscal support wanes we will probably see a slightly changed economy considering that demand has, to some extent, permanently changed following the pandemic. How smoothly this transition occurs will determine the strength of the recovery,” said Árnason. He added “The EFTA States perceived the COVID-19 pandemic as an opportunity to foster structural change and to make our economies greener, more inclusive, and resilient to future shocks”.

Furthermore, some of the EFTA States are seeing some inflationary tendencies. These have "been met with increased interest rates as well an increase in the countercyclical capital requirement,” Árnason noted.

Striking a different note, he stressed the importance of global vaccination for the economic recovery to continue.

“Global vaccine inequality is not only an ethical issue; it also risks causing virus mutations that could bring about economic instability even in countries with broad vaccination coverage.”

Finally, Minister Árnason underlined the need for close international cooperation. “The EFTA States believe that stemming the COVID-19 pandemic, preventing further pandemics, bringing about economic recovery, and addressing climate change will all need more international cooperation, not less,” he said.

Read the Common Paper of the EFTA States.

Read the statement of EFTA Chair Guðmundur Árnason.

Find pictures from the meeting here.

The EFTA ECOFIN meeting is the annual meeting between the finance ministers of the EU and EFTA where economic issues of common interest are discussed. The meeting is held in connection with a meeting of the EU Council of Finance and Economic Affairs (ECOFIN).

#EFTA #ECOFIN meeting starting in @EUCouncil @EUCouncilPress - post #COVID19 #economy topping the agenda pic.twitter.com/aiaF6BWgrL

— Thorfinnur Omarsson (@thorfinnur) November 9, 2021