'Moment of truth': Macron wants European Union recovery fund agreement in July

Elias Hubbard
June 30, 2020

Both leaders are pushing for a 750-billion euro recovery fund proposed by European Commission head Ursula von der Leyen.

The German Chancellor and French President will meet at the 18th-century Schloss Meseberg, a grand palace 40 miles north of Berlin, as the bloc faces its most devastating economic hit since the Second World War.

"I'm very happy that we agree on the challenges that we want to overcome together", added Merkel, who noted that "expectations are high" - referring to Germany's European Union presidency starting from July 1 - but Berlin and Paris are ready to rise to the task, in a bid to invest more into the future to meet those challenges after the pandemic.

The Franco-German pair had sketched out the backbone of the fund but it has run into opposition from so-called "frugal nations" like the Netherlands and Austria.

Hard-hit southern European countries such as Italy and Spain have called on the EU to loosen its purse strings in the response to the crisis.

"During the German EU Presidency we will do everything in our power to master this task together in a forward-looking way and to make Europe strong again", the government said in a draft of its six-month presidency programme, dated June 8.

"It needs to remain a fund that helps the countries that have been much harder hit by the crisis", she said.

"And so it is not in their interest to see some members, especially important markets in the European economy, affected", said Macron.

"It's solidarity to have this transfer but also it is in their own interests", said Macron, according to the AFP news agency. It has already tabled more than one trillion euros in additional spending, loans and guarantees to safeguard the German economy. "Without this, Europe wouldn't rise to the challenge", Macron said, referring to the post-pandemic recovery plan. He said the fund should include 500 billion euros of grants to the hardest-hit countries.

Merkel said that whatever shape the final recovery package takes, "it has to be substantial".

Observers believe that, as the EU's biggest paymaster, Berlin will force even those reluctant saviours to put their hands in their pockets.

An EU diplomat added: "On the Recovery Fund, I expect Germany to dictate the whole process". Merkel is holding all the cards and (EU Council chief) Charles Michel will follow that.

"She also wants to get Brexit out of the way and she will always for the deal she wants to keep the West together. Third leg will be restoring ties with the United States after the election there". Continued Brexit negotiations are also on the cards and in November the focus will be on USA elections and possibility of President Donald Trump's reelection.

Other reports by Click Lancashire

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