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Coronavirus: European Union fails to strike deal on relief package after leaders clash
- European Council chief seeks ‘Marshall Plan,’ but member states divided after six-hour wrangling
- Germany and the Netherlands say more measures may be needed later
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European Union leaders failed to agree on Thursday on the scale of support for their economies battered by the coronavirus, but gave themselves two more weeks to work out details in a dispute between the ailing south and the fiscally conservative north.
Highlighting how the pandemic is testing the bloc’s cohesion, Germany and the Netherlands blocked a call from Italy, Spain and France to issue joint debt to help finance a recovery.
All 27 national EU leaders wrangled during a six-hour videoconference over setting up a credit line worth some 2 per cent of their economic output from the European Stability Mechanism (ESM) bailout fund of the 19-member single-currency zone.
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In the end, they tasked their finance ministers to work out the details in the next two weeks.
“Some member states … suggested those corona bonds,” German Chancellor Angela Merkel said after the discussion ended. “We said that this is not the point of view of all member states. And that’s why the ESM is the preferred instrument for me.”
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Her ally Dutch Prime Minister Mark Rutte said the ESM would be the “last resort”, would still need to come with conditions and that The Hague would not back joint debt.
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