France, Germany push for rapid EU recovery plan agreement

The leaders of Germany and France say they will use their influence as European Union powerhouses to help negotiate a rapid agreement on a coronavirus recovery package for the 27-nation bloc that leaves no country behind

Already in May, Merkel and Macron together proposed creating a one-off 500 billion-euro ($561 billion) recovery fund that would be filled through shared EU borrowing.

That proposal was expanded upon by the European Commission, which put forward plans for a 750 billion-euro fund made up mostly of grants. It’s facing resistance from some countries, however, that oppose grants and are reluctant to give out funds with no strings attached.

Merkel told reporters at a joint news conference with Macron at a German government villa outside Berlin that they hadn't expected their proposal to be adopted word for word but that it signaled their direction.

“The expectations are high and we know that when Germany and France are united, Europe is not necessarily united. But if Germany and France are not in agreement, then it doesn't speak well for the unity of Europe.”

Macron called the virus crisis and its economic and its social consequences “a moment of truth” for Europe.

“We can make this moment of truth a moment of success,” he said, insisting on the need for a European agreement on an economic recovery plan.

“We will do everything, with the Chancellor, to get a budget deal in July," he said.

Macron reiterated that EU measures should include debt mutualization and a package of 500 billion euros in grants that would go to the regions the most affected by the virus crisis.

He also called on the EU to reinforce its sovereignty in a broad range of fields including climate issues, the digital economy, food, health, industry and security.

The virus crisis revealed Europe’s fragility and dependence, he said.

The group of countries that oppose grants, dubbed the “Frugal Four” — Austria, Denmark, the Netherlands and Sweden — benefit from the strength of the EU single market more than the recovery will cost them, he argued.

“That’s not in their interest to see some members ... being affected” by the crisis, he said.

Merkel said that whatever shape the final recovery package takes, “it has to be substantial."

“It needs to remain a fund that helps the countries that have been much harder hit by the crisis,” she said.

“There is naturally still a lot of resistance to overcome, but I think what is really important for many states that may still be skeptical today is the desire that we come through the crisis strong together.”

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Sylvie Corbet reported from Paris.

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