Four European countries on Saturday presented their own stimulus package to help the European Union overcome the crisis caused by the coronavirus pandemic.
The Netherlands, Austria, Denmark and Sweden – known as the “frugal” four – suggest emergency aid for severely affected countries in the form of one-time loans on favourable terms, according to a proposal published by the office of Austrian Chancellor Sebastian Kurz.
According to the proposal, the money loaned must then be “directed towards activities that contribute most to recovery, such as research and innovation, strengthening the health sector and a green transition.”
Earlier in the week, French President Emmanuel Macron and German Chancellor Angela Merkel laid out a 500 billion euro plan via an unprecedented debt pooling mechanism in order to revive the EU economy damaged by the Covid-19 pandemic.
The fact that Germany supported the idea of a jointly issued debt was seen as a decisive turning point in recent EU budget legislative history.
The “frugal four” members, for their part, continue to reject any joint EU debt – a mechanism which, according to them, would allow the weakest and least ‘disciplined’ EU economies to benefit from cheaper financing at the expense of the stronger members in the north.
Their proposal rejects the prospect of any “significant increase” in the EU budget, as envisaged by the Macron-Merkel plan.
The European Commission is due to present its own plan next week to stimulate economic recovery from the crisis.