French President Emmanuel Macron and German Chancellor Angela Merkel on Monday proposed a 500 billion euro recovery plan in Europe in the face of the economic impact of the new coronavirus, which is plunging the continent into a recession of historic magnitude.
"To support a sustainable recovery that restores and strengthens growth in the EU, Germany and France support the creation of an ambitious, temporary and targeted recovery fund" as part of the next European Union budget " endowed with 500 billion euros ”, underlines a joint declaration.
Not really eurobonds
Important element: Paris and Berlin propose that the European Commission finance this stimulus support by borrowing from the markets "on behalf of the EU". This money will then be transferred as "budgetary expenditure" to European countries and "to the sectors and regions most affected", underlines the declaration.
Funding "will be targeted at the difficulties linked to the pandemic and its repercussions". The money will be gradually repaid over several years. With this tool, it is not a matter of the famous "eurobonds", of debt shared directly between European states, such as Italy in particular has claimed but which are rejected by Northern Europe and Berlin.
An emergency program already decided
But this plan, if adopted by the 27 countries of the European Union, would come close to this model. The French head of state stressed that it was "a major step" in the European history of these European loans. "These will not be loans but direct endowments" to the countries most affected, said Emmanuel Macron.
This stimulus plan would be added to the emergency program already decided in the face of the pandemic by the finance ministers of the euro zone and made up of lending capacities in particular.
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- Angela Merkel
- EU
- Recovery plan
- Europe
- Emmanuel Macron
- World
- Economy