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EU leaders start 'very difficult' recovery talks

July 17, 2020

The EU leaders have spent hours discussing the €750-billion coronavirus recovery package in Brussels, but the deal remains far away. The summit is expected to continue well into the weekend.

Angela Merkel, Emmanuel Macron, Charles Michel
Image: picture-alliance/dpa/EPA/S. Lecocq

EU leaders still hold "diametrically different" opinions on the massive coronavirus recovery fund, Czech Prime Minister Andrej Babis said on Friday, following hours of negotiation in Brussels.

"So far I don't have the feeling we are getting closer to an agreement, I rather have the opposite feeling," he told reporters.

The top politicians of the 27 EU member states are working to bridge divisions on the €750 billion ($858 billion) recovery fund. Several northern states, including the Netherlands, Austria, Denmark, Finland and Sweden, believe Paris and Berlin are too ready to give out money to more affected states. The Hague especially wants payments to be conditioned on reforms.

"If they want loans and even grants then I think it's only logical that I can explain to people in the Netherlands...that in return those reforms have taken place," Rutte said. He estimated that chances to reach a deal stood at fifty-fifty.

Merkel's 'vigor'

Ahead of the Friday summit, German Chancellor Angela Merkel said she expected a tough round of negotiations on a multibillion-euro coronavirus recovery plan, at an EU summit in Brussels.

"We are going into the consultations with a lot of vigor, but I must also say that the differences are still very, very large and I cannot, therefore, predict whether we will be able to reach an agreement this time," she said.

"It would be desirable, but we also have to face reality and we really need a great deal of willingness to compromise if we are to achieve something that is good for people and good for Europe in the face of the pandemic. That is why I expect very, very difficult negotiations."

Read more: EU faces deeper recession than expected: European Commission

The summit is facing a number of hurdles, including drastically varying hopes for the outcome and budget allocation. 

According to Italian Undersecretary of State for Foreign Affairs Manlio di Stefano, Italy is hoping for a "conditionless" bailout as a result of the talks over the €1-trillion EU budget and €750-billion coronavirus recovery fund. 

"We have to grant money to the countries that need it, and be clear that they [financial assistance] are not linked at all to the conditions that are already existing in the European Stability Mechanism," Di Stefano told DW.

"We are not saying we want money to do whatever we want, we are saying that we want to use that money to recover from the economic damage caused by the coronavirus," he added. "We are not just debating about the Italian future, we are debating the European Union's future."

Doubtful of deal

Other leaders, including Rutte and Lithuanian President Gitanas Nauseda echoed Merkel's sentiment by expressing a lack of optimism ahead of the two-day summit.

"I'm not optimistic, but you never know," Rutte told Dutch broadcaster NOS as he arrived in Brussels to negotiate the 27-member bloc's 2021-27 budget.

"I'm not so optimistic ... We think the initial [budget] proposal is interesting, promising," Nauseda told reporters upon arrival. 

Read more: European Commission unveils €750-billion recovery plan

'Europe is at stake' 

Despite the pessimism of some of his counterparts, Spanish Prime Minister Pedro Sanchez said that EU leaders have an obligation to their citizens to reach an agreement on the recovery fund. 

"Spain is coming to this summit eager to reach an agreement, to defend logically our national interests on agriculture and also on how we conceive the governance of the recovery fund," Sanchez said.

French President Emmanuel Macron led the early negotiations, arriving Thursday and meeting with Rutte in the pre-summit hours. "The coming hours will be absolutely decisive," said Macron. "It is our European project that is at stake.''

European Council President and summit host Charles Michel said on Thursday that the crisis brought about by the pandemic, "with all of its economic and social consequences, is the most severe we have had to face since the Second World War.'' 

lc/mm (Reuters, AFP, dpa)