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EU agreed €500 bn COVID-19 rescue package, but ECB says €1.5tr needed

EU agreed €500 bn COVID-19 rescue package, but ECB says €1.5tr needed

While the death toll due to the coronavirus is rising across Europe, the finance ministers of 27 members states have agreed a €500bn rescue package for nations impacted by the COVID-19 crisis.

According to Kristalina Georgieva, the chief of the International Monetary Fund (IMF), the world is facing the worst economic crisis since the Great Depression of the 1930s. The EU countries also have to find a common financial solution as soon as possible.

Mario Centeno, a leader of the group of Eurozone finance ministers, announced the deal on Friday after hot discussions which ended Thursday night in Brussels, RFI reported on Friday.

“This plan contains bold and ambitious proposals that would have been unthinkable just a few weeks ago,” said Mr Centeno at a virtual press conference.

France’s Finance Minister, Bruno Le Maire has tagged the agreement as the most important economic plan in EU history and following the deal. “500 billion euros will be made available immediately. A stimulus package is to come. Europe is standing up to face the seriousness of the situation,” Minister tweeted.

In addition, EU ministers chose not to back a demand from France and Italy to create so-called “coronabonds”, after continued resistance from some nations members towards the idea of sharing out the cost of the crisis.

Germany says it shows Europe’s strength and solidarity and Italy calls it ambitious.

The half trillion dollar package agreed is less than the 1.5 trln which the European Central Bank suggests the bloc might need to tackle the crisis caused by the pathogen originated in China last December.

The IMF chief, Mrs Georgieva, also said the current pandemic would lead to ‘sharply negative” economic growth this year.