The new proposals of European Council President Charles Michel on the economic recovery plan were perceived by European leaders at the EU summit as a step in the right direction, they reduced the tension that arose the day before, at the meeting.
The head of the European Council presented an updated proposal on the ratio of subsidies and loans to eliminate the economic consequences caused by the COVID-19 crisis to the heads of state and government of the EU countries who gathered in Brussels yesterday to agree on the EU budget for 2021-2027 and the anti-crisis plan.
Michel proposed to keep the previously proposed package of funds for reconstruction in the amount of 750 billion euros, but to distribute subsidies and loans in a new way: 450 billion euros will be allocated as subventions and 300 billion euros as loans. Initially, 500 billion and 250 billion were proposed, respectively.
вЂњThis is a concession to the вЂњThrifty fourвЂќ вЂ” Austria, Denmark, the Netherlands, and Sweden, which prefer to use loans, as they must be returnedвЂќ.
As a result of consultations that Michel is conducting with individual European leaders for the second day, he also proposed a mechanism to strengthen control over the use of these funds.
Strict control is sought by Dutch Prime Minister Mark Rutte, who demands that the allocation of funds for national projects is unanimously approved by all EU Member States. That is, each of them can veto the financing of a recovery strategy chosen by another EU country.
For Spain and Italy, particularly affected by the coronavirus pandemic, this measure is unacceptable.
In addition, Michel put forward the idea of increasing discounts on contributions to the EU budget for Germany and theвЂќ lean four вЂњ in order to win over supporters of strict budget discipline and reach an agreement at this summit.