Merkel and Conte warn ‘frugal four’ against cuts
to EU corona fund
German and Italian leaders say a big financial package
is needed to secure the bloc’s recovery.
By HANS VON
DER BURCHARD AND PAOLA TAMMA 7/13/20, 9:23 PM CET Updated 7/14/20, 7:33 AM CET
Angela
Merkel had a pointed warning for the countries favoring a more frugal approach
to the EU's coronavirus response: Don't think you can slash the bloc's economic
recovery package.
Speaking at
her retreat outside Berlin following talks with Italian Prime Minister Giuseppe
Conte, the German chancellor said EU leaders meeting this Friday and Saturday
in Brussels had "a long way to go" to agree on the proposed
trillion-euro long-term budget and €750 billion recovery fund, and added that a
second summit before the summer break might be required to clinch a deal.
However, in
what appeared to be a direct message to the so-called frugal four — Austria,
the Netherlands, Denmark and Sweden, who are critical about the proposed size
of the fund and its mixture of grants and loans — Merkel made clear that while
she could agree to small tweaks to the structure of the fund, she will oppose
attempts to slash its size.
"It is
important that what we now have as a recovery fund is massive, is something
special and is not reduced to dwarf size," she told reporters. "It is
not possible to commit to every detail in advance, but it must be a special
effort that makes it clear that Europe wants to stick together at this
difficult time. There is a political dimension to this beyond the figures, and
that is what the project must be measured against."
Merkel
added that both Germany and Italy agreed on the "basic structure" of
the proposal that European Council President Charles Michel presented last week.
She also endorsed the proposal linking payments to conditions on the rule of
law and reforms, and said Conte had already "proactively shown ideas for
Italy on how to get out of this difficult situation."
Conte also
sent a thinly veiled warning to the frugal four by saying that failing to agree
on an ambitious recovery package would risk causing the "destruction of
the single market," which "even for financially stronger countries
would lead to the destruction of value chains and ... would be bad for all."
He added
that a swift agreement is also needed to avoid delays to Europe's economic
recovery.
The press
conference by the two leaders displayed a new degree of harmony and unity
between Germany and Italy that would have been hard to imagine a few months
ago, especially in the field of financial and budgetary policies.
Not only
did Merkel emphasize that Berlin and Rome "will join forces" in the
budget talks, but she also lauded how Italians, among the most severely
affected by the coronavirus crisis, mastered "these difficult weeks with
admirable discipline and patience."
"In
Germany, there were an incredible number of videos that we watched when Italian
citizens sang in the evening and at night and encouraged each other," she
said.
Conte
returned the praise: "I always found that Angela is aware of the situation
we are living in," he said, expressing particular gratefulness for the 44
Italian coronavirus patients that German hospitals admitted at the height of
the crisis.
CORRECTION:
A previous version of this article misstated where Angela Merkel met Giuseppe
Conte. The two spoke at the German chancellor's retreat outside Berlin.
Authors:
Hans von
der Burchard and Paola Tamma
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