BRUSSELS (Reuters) – The euro zone will need at least another 500 billion euros from European Union institutions to fund its economic recovery after the Corona virus pandemic, as well as an agreed package of half a trillion euros, the director of the eurozone rescue fund said.
The easiest way to organize such funds would be through the European Commission and the European Union’s budget, said Klaus Wrigling, head of the European Stability Mechanism Fund, in an interview with Corriere della Sera newspaper published on Sunday.
“I would like to say that we need a second stage, another 500 billion euros from European institutions, and maybe more than that.
“For this we need to research new tools with an open mind, but also use existing institutions, because it will be easier, including the budget of the Commission and the European Union in particular.”
On April 9, European Union finance ministers agreed on safety nets for countries, companies and individuals that totaled € 540 billion.
They also agreed that the euro zone, which the International Monetary Fund expects its economy to contract by 7.5 percent this year, will need money to recover, but their views differ on how much money is needed and how to raise it.
European Union leaders are to discuss this during a video conference on April 23. A compromise is likely to revolve around the European Commission borrowing from the market securing the EU’s long-term budget and then lending money to member states to achieve greater efficiency.