On March 31^st, the European Commission proposed a budget of €4.5 million to be made available to support over 5,000 tourism and self-employed workers in Estonia. The workers who are eligible are people who lost their jobs to the COVID-19 pandemic or had to cease their activities because of it. The money will come from the European Globalisation Adjustment Fund (EGF) which aims to help people to find new jobs by further educating them or giving training with the goal of starting their own business. This would be the first time that the Fund would be used as a result of the COVID-19 pandemic.

Background on the situation

The number of tourists in Estonia plummeted, with a 99% reduction compared to the previous year, at the peak of the lockdown. For Estonia, this is an economic disaster. The tourism industry accounted for nearly 14% of the total workplaces in the country and has had therefore a major negative impact on economic growth and employment.

The European Globalisation Adjustment Fund

The EGF has been providing support to people losing their jobs or self-employed whose activities have ceased as a result of major structural changes due to globalisation since 2007. This happens because of structural changes in world trade patterns, when a large economy shuts down, a production is moved outside the EU or as a result of a global and economic crisis.

About the measures

The measures that will be co-financed by the EGF go from job-searching advice to apprenticeships, opportunities in education and financial support to start a business. To be able to take full advantage of these opportunities, the participants are expected to receive additional incentives such as training and transport or living allowances. The EGF will provide €4.5 million for the support measure, and the Estonian government will provide the remaining to achieve the total estimated value of about €7.5 million. These measures can of course only be taken when first approved by the European Parliament and the Council.

Financial support

In 2021-2027, the EGF will continue to support workers, while shifting the focus from the cause of restructuring to its impact. With the new rules, all reasons for restructuring, including economic effects of the coronavirus, as well as larger economic trends like decarbonisation and automation, can be eligible for support.

B2EU Consulting can help private or public actors to gain access to means of financial or legislative support. Our boutique consulting firm is specialized in European funds and can assist industries on positioning itself favorably for financial support and a smooth transition to a greener future.

_{Image © European Commission, 2020}