The Strategist

EU countries agree that the European Commission needs to borrow money for the anti-crisis fund

07/03/2020 - 06:53

European Union countries agree that the European Commission needs to borrow money on the market for a new anti-crisis fund, said Ursula von der Leyen, Head of the European Commission, at a press conference.

According to her, the Union countries agree that the European Commission is allowed to borrow money for the fund in the market and transfer it through European programs to support the region’s economy. “The overall structure is not questionable, and that’s a good sign,” she said.

At the same time, certain details, for example, the size of the fund and the ratio of loans and grants in the structure of the issuance of money, are not finally agreed.

The European Commission hopes that the EU countries will do everything possible to agree on the parameters of a new anti-crisis fund at the summit of their leaders this July, budget commissioner Johannes Hahn said on Thursday. After reaching such an agreement, it will be necessary for the European Parliament to adopt its position; in addition, in most EU countries, ratification of certain of its parameters may be required.

The extraordinary summit in Brussels, which the EU heads of state are expected to attend in person for the first time since the introduction of restriction measures against coronavirus, will be held on July 17-18 and will be devoted to the EU recovery fund from the severe economic crisis, as well as the EU’s multi-year financial plan for 2021-2027 years. These issues have already been discussed at the level of leaders of EU countries, but no final agreement has been reached on them so far.

This is not the first time a multi-year financial plan is created in the EU, with it then the general annual budgets of the EU are compiled, filled mainly with the money of the Union countries. However, this time the plan should be linked to the new anti-crisis fund, in particular, since part of the fund’s funds should go through the EU budget programs, and also because some parameters in budget planning need to be adjusted to allow the EC to borrow funds in the market to fill the fund.