Germany Merkel warns of failure of summit on EU coronavirus recovery fund

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EU leaders worked hard to find a coronavirus stimulus deal for a third day on Sunday, but German Chancellor Angela Merkel said growing acrimony over spending levels may not be easy overcome.EU energy brokers Germany and France are looking for a 1.8 trillion euro (2.8 trillion Canadian dollar) economic stimulus package to save the bloc’s economies facing their worst recession since World War II.

The sticking points are the size of the new stimulus fund and the proportion that should be in grants and loans, with some richer “frugal” states led by the Netherlands pushing to limit it, highlighting the depth of the northern divide. -south of the EU.

Meanwhile, the summit is struggling to agree on the scale of EU budget rebates for richer countries, as well as a dispute over a proposed new rule of law mechanism, which could freeze funding for the EU. ‘EU to countries which flout democratic principles.

Greek Prime Minister Kyriakos Mitsotakis, whose country was barely recovering from its 10-year debt crisis when the pandemic hit, pleaded for unity, saying the EU could not afford to appear “divided or weak ”.

“I sincerely hope that today we can break the deadlock,” he told reporters upon arriving at the Europa building in Brussels.

Leaders wearing face masks called the summit a watershed moment in nearly 70 years of European integration and failure to come to an agreement amid an unprecedented health and economic crisis would raise serious questions about the sustainability of the country. block, according to officials and experts.

“There is a lot of goodwill, but also many positions. I will do my best but it is possible that there will not be a result, ”Merkel said.

EU diplomats speculated that talks could continue on Monday and Hungarian Prime Minister Viktor Orban has said he is willing to stay in Brussels all week, but another summit later in July was more likely in case no agreement.

With the ongoing consultations, the official start of the summit plenary with the 27 leaders has been delayed indefinitely.

Political quarrels

Late Saturday, Merkel and French President Emmanuel Macron left the last round of informal talks early today, refusing to accept that the level of free grants to struggling economies in the package falls below 400 billion euros ( C $ 620.5 billion).

Italian Prime Minister Giuseppe Conte previously accused the Netherlands and its allies Austria, Sweden, Denmark and Finland of “blackmail”. Stockholm proposes to reduce subsidies to 155 billion euros (240 billion Canadian dollars).

Macron said there was a will to compromise, but that should not deter “the legitimate ambition we need to have”, referring to the level of money available in the planned recovery fund of 750 billion euros (1.1 trillion Canadian dollars), which is to be financed by money raised on the financial markets.

European Council President Charles Michel, center left, chats with German Chancellor Angela Merkel, top right, French President Emmanuel Macron and European Commission President Ursula von der Leyen during a meeting on the sidelines of the first European summit face to face since the COVID -19 epidemic, in Brussels on Saturday. (Francisco Seco / Swimming pool via Reuters)

Dutch Prime Minister Mark Rutte, who faces parliamentary elections by March 2021, was frank about divisions with France and Germany on Saturday evening. “They left annoyed,” Rutte said of Merkel and Macron.

Meanwhile, Hungary, backed by its Eurosceptic ally Poland, has threatened to veto the Dutch-backed rule of law package.

Orban said Rutte had a personal grudge against him. Rutte’s office was not immediately available for comment.

“I don’t know what is the personal reason the Dutch Prime Minister hates me or Hungary but he attacks so hard… I don’t like blame games but the Dutchman is the real responsible for all the mess . Orban told reporters.

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