EU leaders clash over economic response to coronavirus crisis | Eurasia Diary -

3 August, Monday

EU leaders clash over economic response to coronavirus crisis

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European leaders have clashed over how to pull their economies through the coronavirus crisis, as Italy accused other member states of a timid response to an unprecedented economic shock, EDNews reports citing The Guardian.

Meeting via a video link, the EU’s 27 leaders papered over deep divisions by agreeing that another fortnight was needed to discuss ambitious economic recovery plans. After a testy debate over “coronabonds”, i.e raising funds through issuing shared European debt, the bloc kicked a decision down the road, by calling on EU finance leaders to present proposals within two weeks.

Even as the virtual summit was still ongoing, Italy’s prime minister, Giuseppe Conte, released a statement rejecting an earlier pre-prepared draft statement because he thought it was a weak response to the scale of the crisis.

Hours before the summit, Conte called for “extraordinary and exceptional measures” to help Europe’s battered economies deal with a sharp downturn and the expected surge in joblessness resulting from coronavirus.

Backed by France, Spain and seven other eurozone countries, Italy wants a “European recovery bond” or “coronabonds” – namely, EU-backed debt to lift member states out of a recession and increase spending on healthcare.

But the idea of shared debt remains anathema to Germany, Austria and the Netherlands, who shunned the similar concept of “eurobonds” during the eurozone crisis a few years earlier.

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