Charles Michel, president of the European Council, said the €540 billion ($582 billion) recovery package would provide safety nets for workers, businesses and member governments. (AP)
The next step will be for members of the commission to flesh out the proposed recovery package so that it can be presented at their next meeting online on May 6, Michel said.
Michel said the council agreed to work toward the pandemic recovery plan whose framework was agreed to April 9 by EU finance ministers. The so-called Eurogroup said at the time that the spending would be temporary and targeted, but it skipped key details, such as whether EU countries that use the euro currency would collectively issue bonds to finance the aid package.
EU members have been split over the potential for so-called coronabonds. Some poorer, largely southern European governments — many hit hard by the outbreak — argue that bonds would help close budget deficits caused or worsened by the pandemic. Richer nations in the north have been wary of sharing the debt burden with partners lacking rigorous fiscal controls.
Ahead of their fourth videoconference meeting on the pandemic, several council members had made public the differing internal views on the size, structure and operation of any fund aimed at stabilizing the EU's battered economies. And, like the Eurogroup two weeks ago, Michel disclosed few details Thursday, indicating continued division among members.
"This fund shall be of a sufficient magnitude, targeted toward the sectors and geographical parts of Europe most affected, and be dedicated to dealing with this unprecedented crisis," he said in an online news conference from Brussels.
"This pandemic is putting our societies under serious strain," Michel said. "The well-being of each EU member state depends on the well-being of the whole of the EU. We are all in this together."
He said the package would provide safety nets for workers, businesses and member governments, and that the council called for it to be up and running by June 1.
Commission President Ursula von der Leyen, who joined Michel following the council's meeting, called for linking the massive recovery effort to the EU's seven-year budget. The International Monetary Fund has suggested the emergency rescue could top €1 trillion — a figure repeated this week by Klaus Regling, who heads the European Stability Mechanism, the EU's permanent bailout fund.
"The budget is time-tested," von der Leyen said. "Everybody knows it. It is trusted by all member states."
She said additional investment in the seven-year budget "should be front-loaded in the first years and of course it is necessary to find the right balance between grants and loans."
Asked by a reporter what amount of money might be found with some adjustments, she said, "We're not talking about billion, we're talking about trillion."
Germany, which is among EU members that have taken a harder line in ensuring the bailout be fiscally sound, praised the newly approved package. Chancellor Angela Merkel said in a statement that although Germany would have to make a greater contribution to the bloc's next budget, "that's right and good."
French President Emmanuel Macron said he was glad the council had found "a consensus on a fast response, and a strong one."
"It is true that there are disagreements on the mechanism," Macron said, and he insisted that the EU "will need real economic budgetary transfers, not simply only loans, but transfers to the worst affected regions and sectors."
News of the agreement was also welcomed in pandemic-ravaged Italy, where Prime Minister Giuseppe Conte has faced intense pressure from citizens and within his government to block efforts by northern partners to link a rescue plan to austerity measures down the road.
''The recovery fund will finance all the countries hardest hit, Italy but not only. It is an urgent and necessary instrument," Conte was quoted as saying in a video address on Italian media.
Over 100,000 Europeans are known to have died from COVID-19, the respiratory disease caused by the novel coronavirus, according to the European Center for Disease Prevention and Control.
--Editing by Tim Ruel.
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