Differences among EU countries look set to stymie any major decisions on tackling the long-term economic impact of the crisis at a summit later this week.
In a letter Tuesday inviting the 27 leaders to the videoconference, EU Council President Charles Michel says only that they should “work towards” establishing a long-term rescue fund.
— Charles Michel (@eucopresident) April 21, 2020
But the question of how much the fund should be and how to finance it remain highly contentious.
“My suggestion is that we agree to work towards establishing such a fund as soon as possible,” Michel said in his letter.
“It should be of sufficient magnitude, targeted towards the sectors and geographical parts of Europe most affected, and be dedicated to deal with this unprecedented crisis.”
Michel proposed asking the European Commission, the bloc’s executive, to analyse the needs and come up with a plan.
This will involve clarifying how such a fund would relate to the EU’s new seven-year budget — already a subject of deep division among the member states.
Leaders will also be asked to sign off on a €540 billion emergency package to deal with the crisis agreed by EU finance ministers earlier this month.
Various figures have been bandied around for the long-term fund — Eurogroup president Mario Centeno has suggested a range of €700 billion to €1.5 trillion, while French Finance Minister Bruno Le Maire mooted a trillion.
France, Italy, Spain and some other countries have suggested EU countries could jointly raise money to help stimulate a recovery after the pandemic.
But these so-called “coronabonds” have been flatly rejected by Germany, the Netherlands and others.
European commissioner for the Internal Market Thierry Breton said on Tuesday EU countries should “put on the table” 10% of their GDP in the common effort to combat Covid-19. He appeared to suggest that this money whould become part of the next long-term budget for the Union for 2021-2027.
Along with his letter, Michel published a five-page “roadmap for recovery”, drawn up with commission President Ursula von der Leyen.
The roadmap offers no concrete conclusions beyond a pledge to come up with a “more detailed action plan” setting out what measures will be taken and when.