On April 9th 2020, EU finance ministers agreed on a set of economic measures to help the EU and its member states recover from the economic shock of the coronavirus crisis.
While the absence of conditionality for access to ESM credit lines signals a deal that could provide adequate support for some affected countries, it falls short of the necessary ambitions for true European solidarity. Spanish and Italian governments have already declared their intention to not use the ESM credit, calling into question the effectiveness of the new measures. Furthermore, the deal agreed upon last night only includes liquidity measures and therefore fails to deliver a fiscal solution, such as the mutualisation of debt through the issuance of coronabonds.
The Eurogroup proposal regarding innovative financial instruments to finance the "recovery fund" remains vague, with cause for concern due to the ambiguity. It now remains up to Member States to deliver an ambitious solution. As the European Green Party, we remain convinced that mutualisation of debt is the solution needed for Member States to recover from the crisis, and we continue calling for coronabonds.
Evelyne Huytebroeck co-chair of the European Green Party comments:
“A European compromise has been found, it is a necessary first step but we cannot be fully satisfied with it. In order to face this crisis, member states will have to take on more debt. With no instrument for mutualised debt, we fear that the only consequence will be to increase the inequalities between Eurozone countries' finances and open the door again to harsh austerity measures that already proved to be totally counterproductive.”
Thomas Waitz, co-chair of the European Green Party comments:
“We demand much more clarity on the recovery fund mechanism that has been very vaguely designed in the present deal. EU leaders must now commit to a strong fund through the EU budget which would be a much clearer sign of EU solidarity and a much better recovery instrument for the most affected countries and their citizens.
Coronabonds should remain the main goal for EU leaders. They would be best financial mechanism for all member states to ensure speedy economic recovery.”
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