• Covid-19 Pedro Sánchez and eight other EU leaders request by letter the issuance of Eurobonds
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The clamor for Eurobonds or Coronabonds , as they have begun to be called as a result of the current crisis, are a request that overcomes the European debate from time to time, but they have become more relevant given the economic difficulties that some countries face as a result of the Covid-19 pandemic. Spanish President Pedro Sánchez and eight other European officials have asked the European Council by letter to put them into action, but this issue divides the region's leaders. Let's see what they are and why:

What do they consist of? This is a financial vehicle that allows the debt and risks of all countries to be mutualized under the common currency umbrella. Until now, each state issues its own debt on its own terms. Eurobonds would allow the Eurozone to issue a single bond backed by all countries, which would lower the risks and the interest to be paid by the states, since the responsibility for payment would be pooled. Why do some countries insist on asking for them? Europe? Countries like Spain or Italy, hard hit by the pandemic, would thus have greater capacity to finance their needs at a lower cost, since they generate more confidence among investors than the sovereign debt of each of them individually. Others resist? As it is a joint debt and guaranteed by all, "countries that enjoy good health in their public accounts and in their economy do not find incentives to issue them because they believe that they will have to pay for the broken dishes of countries that do not they have done the homework »established by the European authorities in the wake of the 2008 financial crisis, according to Juan Carlos Higueras , analyst and professor at EAE Business School.Which states are opposed? Germany and the Netherlands are the main champions of the movement against these bonds. German Chancellor Angela Merkel went on to say that while she ruled, she would not allow this type of emission. Which are in favor? Spain is one of the European states that is putting the most pressure to make this measure succeed. Also Portugal, Italy or France are in favor and in recent days, the President of the European Commission, Ursula von der Leyen, and the Vice President of the ECB, Luis de Guindos, have supported them.

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  • Ursula von der Leyen
  • European Comission
  • economy
  • Coronavirus
  • Covid 19

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