Yesterday the European heads of state and government held a video conference until late in the evening to discuss joint responses to the Corona crisis. In the absence of agreement among EU Member States, they instructed the Eurogroup to prepare a fiscal policy response within two weeks. However, the Eurogroup had been unable to reach agreement before the summit. In the run-up to the summit, nine EU Member States, including France, Italy and Spain, but also Luxembourg, Ireland and Slovenia, had asked EU Council President Charles Michel to introduce Eurobonds to finance a joint crisis response. Germany, Finland, Austria and the Netherlands rejected this.
MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:
“It is irresponsible to let the EU summit fail in this serious sanitary and economic crisis. The failure is a fatal sign for European cohesion. With an export ban on medical goods, Germany acted selfishly at the beginning of the Corona crisis. The rejection of Eurobonds shows that the German Federal Government is also failing to show European solidarity when it comes to economic policy. The virus was not caused by any European state and threatens all citizens equally. We now need also decisive joint fiscal action to fight this crisis. With its categorical rejection of joint liability, the German Federal Government is building up a populace. Without a common fiscal policy, it is once again up to the European Central Bank to pull the coals out of the fire. However, we are equally jointly liable for ECB’s action.
Shared liability and great economic advantages are equally part of European monetary union. The refusal of a common fiscal policy in the euro zone shifts the necessary decisions from the area of parliamentary democracy to the realm of independent monetary policy. The refusal of the German government to assume responsibility for European policy shifts the entire burden of crisis management onto the shoulders of the ECB. The failure to reform the European Economic and Monetary Union leaves the ECB no choice but to flood the markets with liquidity and leave interest rates at rock-bottom. It is also fundamentally wrong in terms of European policy that the German government is once again standing up to France.”