PARIS - The European Union should
mobilise all of its existing crisis measures in response to the
coronavirus outbreak and come up with new joint mechanisms to
finance the recovery, France's finance minister said on
Thursday.
Bruno Le Maire said the European Stability Mechanism, the
bailout fund with 400 billion euros ($436.8 billion) in
firepower, should be made available as a source of financing to
countries with only minimal conditions attached and without
stigma for using it.
He said new financing of up to 200 billion euros should also
be made available from the European Investment Bank and gave his
support to a European Commission proposal for a unemployment
reinsurance scheme for a total amount of 100 billion euros.
"These three instruments could be our common European
framework to immediately face the economic crisis," Le Maire
said in an online news briefing.
"In addition to the framework, the EU should be reflecting
on long-term instruments that would be useful to restart the
economy after the crisis."
Last week EU leaders gave finance ministers until April 9 to
come up with ideas how to finance the recovery after Germany and
the Netherlands shot down a call from France, Italy, Spain and
six other countries for a common debt instrument issued by a
European institution.
Le Maire floated the idea of a temporary joint fund aimed
solely on financing and coordinate the economic stimulus after
the health crisis.
Focusing the fund on a single purpose and limiting its
lifespan to five to 10 years could help overcome traditional
opposition in fiscally conservative Germany and the Netherlands
to joint debt.
The fund would be financed by issuing bonds benefiting from
a guarantee from all EU member states and operated by the
European Commission, Le Maire said, declining to say how big the
fund should be.
Countries could tap into the fund depending on how much
economic damage they suffered during outbreak and would be kept
out of the European Union's long-term budget.