Angela Merkel fears the economic crisis is underestimated in the EU | the Enterprise

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Angela Merkel has expressed fears that the people do not appreciate what this means for the doldrums in the “deepest recession since the second world war”, as EU leaders clashed on a resumption of funds to the countries most affected by the coronavirus pandemic.During a video conference call between the 27 heads of state and government, the German chancellor has given his support to the French president, Emmanuel Macron calling for an agreement before the summer holidays on a €750bn rescue plan.

Angela Merkel said that Europe is facing “very, very difficult” and reflects on the opportunity of the gravity of the situation was really understood when she was addressed to his counterparts of call within the EU, according to diplomatic sources. The value of the economies of some member states are expected to decrease by up to 10% in 2020.

“It was clear that we would not reach a result today, but we’re going to continue discussions in mid-July,” Merkel said later to reporters. “Everyone said what they thought was positive and, of course, brought in the points of criticism too. The bridges that we still have to build are great.”

Macron has also urged his fellow leaders to find a common ground, the next month, citing the need to calm markets before a difficult phase of talks on the future of trade and security relationships with the united KINGDOM. Ireland, Belgium and the netherlands want the reconstruction fund to offer support in the case of the negotiation to end without an agreement.

The president of the European commission, and Ursula von der Leyen, has admitted that “no one can say with certainty where these negotiations [with the UK] will be at the end of this year”.

During their first real talks about the pandemic of the rescue fund, the leaders provided radically different views of the whole of the scale of funds that will be distributed, the balance of loans and grants, and the criteria of the money is allocated.

Some EU leaders – including those representing the “thrifty four” of the netherlands, Austria, Sweden and Denmark – are still not convinced by the need for the state-free grants.

A diplomat from one of the skeptics of the country, said: “If we, as the EU is going to borrow money, we don’t want to say” yes ” and only then work on what we spend, how we spend it and who gets what.

“Are you borrow money to borrow or to invest? Then, you must know first what you are going to spend and how profitable it is. But the entire political discourse in some countries, it is exactly the opposite: we give the money first and then all will be well.”

Charles Michel, the president of the European council, the body through which the heads of state and government are represented, has declared to journalists at the end of Friday’s discussions that he was going to organize a physical meeting of the leaders in the middle of July, in Brussels, to start concrete negotiations on the EU long-term budget and the pandemic of the recovery plan.

“On some subjects, it remains a very complex and very different,” Michel said. “We will work very hard to expedite the negotiations in order to have an efficient and useful meeting in July.”

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The commission has particularly upset some of the more severe of the leaders in suggesting that the allocation should be based in part on unemployment in the member states before the crisis.

Von der Leyen has defended the EU executive’s proposal, insisting on the fact that the proposed injection of funds, raised through the issuance of european debt, required to address the reasons why some countries have suffered more harm than others.

She said: “The damaging effect of course was significant in those member states which have not been strong enough in the whole of the structure to absorb the shock of the crisis … It is very well represented in the unemployment rate during the past few years.”

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