Europe Must Urgently Start To Support The Coronavirus-Affected Economies

Europe Must Urgently Start To Support The Coronavirus-Affected Economies

Europe must urgently start distributing money to support the new coronavirus-affected economies from its recovery fund and should start discussing the creation of a permanent fiscal instrument. Christine Lagard, the head of the European Central Bank (ECB), said this. EU leaders have not yet agreed on the details of a large € 750 billion reconstruction fund, called the EU's next generation.

Lagard: Deadlines must be met

Persistent disagreements increase the risk that money will not reach the most affected countries in time. "The aim of the European Commission is to be able to distribute this money at the beginning of 2021, and this must be observed," the head of the ECB told Le Monde in an interview. "In addition, we need rapid progress in the political field, especially in terms of action by national parliaments," she added.

Clear funding objective

According to Lagard, it is important that finances are targeted. Otherwise, they will "get lost in the administrative labyrinth" and will not be able to support the transformation of the real economy in the post-pandemic period. At the same time, she added that European leaders should consider changing the reconstruction fund to a permanent one, which is still taboo for some more conservative governments. In addition, they should start discussing the creation of a permanent budget for the euro area. "In our opinion, it is important that the fiscal safety net that governments put in place during this crisis is not withdrawn too soon," Lagard added.