• TOP NEWS
  • CITY & TOWNS
  • LOCAL
  • BUSINESS
  • NATION
  • WORLD
  • SPORTS
  • OPINION
    • EDITORIAL
    • ON HERITAGE
    • CREATIVE BEATS
    • INTERALIA
    • WIDE ANGLE
    • OTHER VIEW
    • ART SPACE
  • Photo Gallery
  • CARTOON
  • EPAPER
Friday, July 4, 2025
Kashmir Images - Latest News Update
Epaper
  • TOP NEWS
  • CITY & TOWNS
  • LOCAL
  • BUSINESS
  • NATION
  • WORLD
  • SPORTS
  • OPINION
    • EDITORIAL
    • ON HERITAGE
    • CREATIVE BEATS
    • INTERALIA
    • WIDE ANGLE
    • OTHER VIEW
    • ART SPACE
  • Photo Gallery
  • CARTOON
  • EPAPER
No Result
View All Result
Kashmir Images - Latest News Update
No Result
View All Result
Home WORLD

Stimulus package breaks new ground in European unity

AFP/ PTI by AFP/ PTI
July 22, 2020
in WORLD
A A
0
Stimulus package breaks new ground in European unity
FacebookTwitterWhatsapp

Frankfurt:  European leaders took a historic step towards sharing financial burdens among the EU’s 27 countries by agreeing to borrow and spend together to pull the economy out of the deep recession caused by the virus outbreak.

Pushed by Germany’s Angela Merkel and France’s Emmanuel Macron, leaders agreed to borrow together by selling bonds, using the European Union’s collective strong credit rating to borrow at low interest costs.

Related posts

China says it was smeared in Biden State of the Union speech

China says Sino-India border dispute complicated, takes time; Ready to discuss delimitation

June 30, 2025
Muslim pilgrims converge at Mount Arafat for daylong worship as Hajj reaches its peak

Thousands of Indian pilgrims join millions of Muslims to perform Hajj in Saudi Arabia

June 6, 2025

The money will fill a 750 billion-euro (USD 855 billion) recovery fund that will boost the hoped for economic rebound next year and restore growth and jobs lost in this year’s plunge.

Two decisions – shared borrowing, and simply handing out much of the money as grants – broke longstanding resistance from some of the financially stronger countries to exposing their finances and taxpayers to troubles in southern Europe where bureaucracy and red tape continue to slow growth.

Germany, which had long resisted shared borrowing, played a decisive role by changing its approach in the face of the crisis as Merkel pressed for a deal.

“With the biggest-ever effort of cross-border solidarity, the EU is sending a strong signal of internal cohesion,” said Holger Schmieding, chief economist at Berenberg bank.

“Near-term, the confidence effect can matter even more than the money itself.”

The EU’s executive commission predicts the bloc’s economy will shrink by 8.7 per cent this year and rebound by 6.1 per cent next year. The goal of the spending is to support that upswing.

By turning to shared debt and spending, the EU is taking a different approach to solidarity than it did during the debt crisis that pushed Greece and four other members of the 19-country euro currency union into international bailouts in 2010-2015.

Greece was rescued with loans that have to be repaid, increasing its debt load. That help came with tough conditions to rein in government spending that reduced growth, spread hardship and fueled resentment.

The four-day meeting nevertheless put the bloc’s deep-seated fault lines on display.

To overcome resistance from five European countries led by the Netherlands, they trimmed the amounts to be dispensed as grants and increased the amount offered as loans that have to be paid back. The money will not kick in until next year and the fund is a one-off, meaning that while it sets an important precedent it does not necessarily lead to ongoing mutual support that could be counted on in any future crisis.

The grant provision is important because it will enable countries like Italy and Spain to spend more on their economies without adding to their national debt piles. Both were hard hit by the virus outbreak and Italy in particular has a large debt burden that must be regularly rolled over with new borrowing.

A huge spike in debt could deter bond markets from lending at affordable rates.

Resistance from the Netherlands, Austria, Sweden, Finland and Denmark reflects skepticism about the pace of economic reform in the countries that need help.

Yet the trillions in financial support are starting to add up. Although the European response is spread across EU institutions, the European Central Bank, and the individual nations governments, economists say the stimulus figure is weighty enough to impress international investors so they will keep lending to indebted countries such as Italy and avoid another debt crisis.

The 750 billion euro recovery fund comes on top of a 1.1 trillion euro EU budget that pays for the union’s agricultural support, projects to help poorer members catch up and myriad other programmes.

Previous Post

Rajasthan HC requests Speaker to defer action on disqualification notices till Friday

Next Post

COVID-19 has aggravated pains for deal-making, 2020 to be uncertain year: Report

AFP/ PTI

AFP/ PTI

Next Post
COVID-19 has aggravated pains for deal-making, 2020 to be uncertain year: Report

COVID-19 has aggravated pains for deal-making, 2020 to be uncertain year: Report

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

ePaper

  • About us
  • Contact us
  • Our team
  • Terms of Service
E-Mailus: [email protected]

© 2024 Kashmir Images - Designed by GITS.

No Result
View All Result
  • TOP NEWS
  • CITY & TOWNS
  • LOCAL
  • BUSINESS
  • NATION
  • WORLD
  • SPORTS
  • OPINION
    • EDITORIAL
    • ON HERITAGE
    • CREATIVE BEATS
    • INTERALIA
    • WIDE ANGLE
    • OTHER VIEW
    • ART SPACE
  • Photo Gallery
  • CARTOON
  • EPAPER

© 2024 Kashmir Images - Designed by GITS.