European Union Sets Out 750-Billion-Euro Coronavirus Recovery Plan
The European Union is proposing a 750-billion-euro ($824 billion) coronavirus recovery plan to assist the bloc with its recovery.
The funds, as well as targeted reinforcements to the long-term EU budget for 2021-2027, will bring the total financial firepower of the EU budget to 1.85 trillion euros, according to the European Commission.
“This is Europe's moment. Our willingness to act must live up to the challenges we are all facing. With Next Generation EU we are providing an ambitious answer,” said Commission President Ursula von der Leyen.
"The coronavirus pandemic has shaken Europe and the world to its core, testing health care and welfare systems, our societies and economies and our way of living and working together."
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EU Must Evolve To Survive, CIO Says
"While the EU relief package will certainly help things in Europe, it appears to be more of a stop gap measure and pales in comparison to actions taken by the U.S. government,” Zach Abraham, chief investment officer and principal at Bulwark Capital Management, told Benzinga.
"Although we are keeping a watchful eye on all ECN and EU relief measures, we are far more focused on recent comments by Macron and Merkel that point to a willingness or at least an openness to a tighter fiscal union.”
In Abraham's view, the EU cannot continue as it is structured today.
"Either Germany will have to relent on ECB guidelines which restrict the central bank from applying unilateral QE and other forms of monetary stimulus (currently the ECB can only apply monetary stimulus evenly across all member countries) or more countries, specifically Italy and Spain, will be forced to leave.”
This issue is far more critical to the economic prospects of the EU as a whole, the professional investor said.
On Friday, billionaire George Soros said the survival of the EU is challenged and that the EU may break apart in the wake of the coronavirus pandemic unless the bloc issues perpetual bonds to help weak members such as Italy. Soros said the damage to the eurozone economy will last longer than most people believe.
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