Euractvi: Eurogroup Fails to Progress on Economic Response to Pandemic

• 04.08.2020, 15:01
•  Europe,  World

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After a 16-hour teleconference that concluded on Wednesday morning (8 April), eurozone finance ministers failed to find an agreement on the economic package to tackle the  economic impact of the coronavirus, Euractiv reports.

Disagreements persisted after the Netherlands continued to insist on strict conditions for soft loans to hard-hit countries like Spain and Italy under the eurozone bailout fund, the European Stability Mechanism (ESM).

Ministers also differed on whether to issue joint debt known as "coronabonds" as part of a wider recovery plan to overcome the severe recession that the coronavirus will cause.

"After 16h of discussions we came close to a deal but we are not there yet," said Eurogroup President Mario Centeno on his Twitter account. The teleconference will resume on Thursday.

Before the meeting started, national and EU officials were hopeful that an agreement could be reached on a series of loans and guarantees to protect the European economy from the damage caused by the coronavirus.

The package included a liquidity injection totalling around €500 billion aimed at national governments (via the European Stability Mechanism), companies (through the European Investment Bank), and workers (via the European Commission"s new SURE instrument).

The Eurogroup was also going to discuss the recovery plan that should follow this liquidity package, to kick start the economy once the pandemic recedes and countries lift the confinement measures.

But ministers failed to make a breakthrough during a long teleconference which started on Tuesday 4pm. The discussion broke on several occasions to draft proposals seeking to bridge what one official described as "big differences".