BRUSSELS (Reuters) – European Union leaders appeared to be close to agreeing on a massive stimulus plan for their coronavirus-ruined economies on Monday night after the president of his four-day summit presented a new proposal to close the gaps between them.
EU Council President Charles Michel said he was confident that the commitments he offered to the 27 leaders would reach an agreement on the € 750 billion recovery fund that many say is critical to allaying doubts about the future of the block.
“I know that the last steps are always the most difficult but … I am convinced that an agreement is possible,” he said.
The EU was slow to coordinate its initial response to the COVID-19 pandemic and, already weakened by Britain’s exit from the bloc, needs the economic aid deal to publicly demonstrate that it can move towards a crisis and stay together.
“It has been a long summit and a challenging summit, but the award is worth negotiating,” Irish Prime Minister Micheal Martin said when the Brussels summit lasted until its fourth day, approaching the record length set in a meeting. 2000 in the French city of Pleasant.
European nations have done a better job of containing the coronavirus than the United States after the devastating first months that particularly hit Italy and Spain, collaborating on the medical, travel and economic fronts.
The European Central Bank has injected unprecedented money into economies to keep them running, while capitals work on their recovery fund.
Diplomats said the leaders appeared to have put aside the grudge that hampered engagement during hours of haggling over the weekend, and one said they were “on the home stretch.”
‘STINGY AND EGOTISTIC’
Emotions rose at a dinner on Sunday when a group of fiscally austere northern nations led by the Netherlands stood firm at the level of free grants within a proposed special recovery fund of € 750 billion overall.
French President Emmanuel Macron lost his patience in the early hours of Monday, slamming his fist on the table in frustration with the “sterile blocks” of the “frugal”, two diplomats said.
Polish Prime Minister Mateusz Morawiecki also criticized the “frugal”, calling them “a group of stingy and selfish states” that looked at things through the prism of their own interests.
Poland would be one of the main beneficiaries of the recovery package, as it would receive tens of billions of euros in grants and cheap loans, along with the high-debt countries on the Mediterranean edge that have taken the brunt of the pandemic in Europe. .
Despite Monday’s continued rhetorical skirmish, diplomats across the bloc seemed optimistic that a deal on the stimulus package and, tied to it, the EU’s common budget for 2021-2027 of about $ 1.1 trillion euros was at hand.
Hopes for a deal to help tackle Europe’s deepest recession since World War II pushed Italy’s borrowing costs to their lowest level since early March and pushed the euro up to a 19-week high.
Michel proposed that within the € 750 billion recovery fund, € 390 billion should be non-repayable grants, below the € 500 billion originally proposed, and the rest in repayable loans.
The Netherlands had lobbied for a veto on aid to countries backing off on economic reform, but diplomats said they were now ready to endorse a “stopwatch” mechanism by which member states could curb disbursements for three months. and have them reviewed.
Disbursements will also be linked to governments that observe the rule of law. Hungary, backed by Eurosceptic ally Poland, had threatened to veto the package if the funds were conditional on maintaining democracy, but diplomats said a way forward had now been found.
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Reports by Jan Strupczewski and John Chalmers; Additional reports from Roboin Emmott, Kate Abnett and Yun Chee Foo in Brussels, and from Reuters offices across Europe; Written by John Chalmers; Editing by Hugh Lawson and Peter Cooney
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