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Corona and the EU: “A single provocation” policy

Four EU Member States only want to help the countries most affected by the corona pandemic with loans instead of grants. They get violent opposition.

A struggle has broken out in the European Union for the reconstruction fund proposed by Chancellor Angela Merkel (CDU) and French President Emmanuel Macron for the Member States worst hit by the corona pandemic. Austria, Sweden, Denmark and the Netherlands insist on a time limit in a counter-proposal and reject grants. Austria’s Chancellor Sebastian Kurz warned of “a debt union through the back door”. The group of four’s proposal stipulates that the EU should take out loans to support the Member States particularly affected by the corona pandemic, but – contrary to Merkel and Macron’s proposal – they must be repaid by the recipients.

In Germany, the advance received keen criticism. “The miserly four’s proposal is a single provocation because it would not solve the problem, but would exacerbate it,” said the chairman of the Foreign Affairs Committee, Norbert Röttgen (CDU), who Süddeutsche Zeitung. The excessive indebtedness of individual countries cannot be solved by offering further debts. Tactically, the four countries only want to get their previous discount on contributions to the EU budget. For this, the group takes “not only the economically particularly hard hit countries like Italy and Spain, but also the cohesion of the EU in these difficult times as hostages”. The countries “served populism in their own country and accepted to stir up populism in other countries”.

The European spokeswoman for the Greens in the Bundestag, Franziska Brantner, spoke of a “lying black driver proposal”. “The miserly four themselves benefited massively economically from a functioning internal market, but want to distribute the contribution to it on the shoulders of the others and at the same time agitate against it at home in populist fashion,” she said. Meanwhile, approval came from the FDP. “While Merkel and Macron want to clear the way for permanent new debt, the four states are reinforcing European law,” said the FDP parliamentary group in the Bundestag, Christian Dürr.

He suggested that the four countries’ proposal be made “the basis for the reconstruction plan after the Corona crisis”.

Italy is outraged

There was outrage in Italy, where Merkel’s and Macron’s plan had been received with enthusiasm. The paper of the group of four is “defensive and inappropriate,” said European Minister Vincenzo Amendola. “Italy contributes more to the EU budget than these four countries combined,” he added. The four countries would hardly be able to maintain their resistance if Germany, France and Italy “resolutely went their own way,” said former EU Commission President Romano Prodi. Prime Minister Giuseppe Conte tried to weaken the front of the opponents in telephone calls, it was said in Rome.

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Chancellor Merkel and President Macron proposed a fund with a volume of EUR 500 billion. It is to be financed through bonds from the EU Commission, which the Member States will later replace in accordance with their contributions to the EU budget. Germany would have to bear about a quarter of the costs.

Merkel received support from the Union. In “this absolutely emergency situation”, EU borrowing is “exceptionally justifiable to support regions and sectors particularly affected by a temporary fund in their economic recovery with earmarked grants,” according to a letter from the CDU / CSU parliamentary group vice-president Andreas Jung and the budget spokesman for the Union, Eckhardt Rehberg, to the members of the Union.

It is not about enabling the European Union to have permanent indebtedness, it says in the letter that is available to the SZ. “Fundamentally wrong” is therefore the reference by Finance Minister Olaf Scholz (SPD) to the first US Treasury Secretary Alexander Hamilton, who had drawn federal competencies in 1790. The EU would not continue to be a “central state”, they emphasized.

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