EU finance ministers agreed on a compromise strategy Thursday to fight the coronavirus economic fallout with emergency credit lines and spending plans — but no corona bonds.
Ministers quickly signed off on a deal that France, Germany, Italy, the Netherlands and Spain had put together in private talks before the online Eurogroup meeting formally began at 9:30 p.m. Brussels time, more than four hours late.
The text of the accord allows the European Investment Bank to set up a fund to back as much as €200 billion of loans to cash-strapped companies across the bloc.
Any eurozone country will be able to draw on a credit line worth 2 percent of its annual economic output from the club’s bailout arm, as long as the money is used for health care costs. The credit lines will only be available to handle the crisis and should be available within two weeks.
No other conditions apply. But the deal still calls on recipients to remain committed to keeping their finances in check after the coronavirus crisis is over.
The negotiations also endorsed the European Commission’s €100 billion jobless reinsurance plan. The initiative will be temporary and focused on protecting workers, while also helping with some medical costs.
Ministers stopped short of sanctioning corona bonds. They will instead “work on” building a temporary “recovery fund” that could provide money to countries through the EU budget to help an economic recovery. But the ministers left it to government leaders to figure out how the fund will raise money.