EU states approve aid package and order another

The first package will mobilize up to EUR 540 billion to soften the effects of the coronavirus pandemic.

Photo: POOL/REUTERS / Ritzau Scanpix

EU heads of state and government approved a support package Thursday at a digital summit meeting. At the same time, they asked the EU Commission to submit a proposal for additional aid – and one twice as large.

The first of these, which will mobilize up to EUR 540 billion to offset the consequences of the Covid-19 pandemic, was negotiated and settled by member states' finance ministries during Easter. It will be ready on June 1.

EU countries have asked the EU Commission to prepare a proposal for yet another, even larger and long-term economic recovery plan.

"It is necessary and urgent. It must be of sufficient size and target the sectors that need it most," says EU President Charles Michel, adding:

"The EU Commission must analyze and promptly present a proposal set at the level that it needed."

The Commission is working on a new proposal for a long-term budget on which the recovery will be be based.

Ursula von der Leyen, EU Commission president, says that there are come concerns about certain EU states potentially offering more aid to their companies compared to other countries. Doing so would, von der Leyen says, create an imbalance normally be in violation of EU regulation.

"There's a big difference between how much EU countries can provide in support. It's connected to their available discretionary budgets. This would to a high degree affect the fair-play rules unless we balance it," von der Leyen says.

She adds that it will also be necessary to significantly increase the size of the EU own resources some some years.

She sees a clear advantage in the recovery fund being tied to the EU's long-term budget, as doing so will enable demands to be made regarding green and climate-friendly investments.

The summit unfolded undramatically and according to plan, as participants had already agreed to land on a written conclusion.

Heads of state and government were expected to present suggestions for how to finance the recovery plan.

After the meeting, it become clear that EU states continue to disagree on how to stitch together a recovery plan and fund.

English Edit: Daniel Frank Christensen

(Note: Citations translated from Danish)

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