Brexit financial blackhole: Macron and Merkel organise emergency meeting on recovery fund

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Due to the coronavirus pandemic which ravaged Spain and Italy, the EU has put forward a mammoth €750billion (£676billion) rescue fund. That huge recovery fund will be on top of a proposed €1.1trillion (£993billion) EU long-term budget for 2021-2027. Both funds have come under fierce opposition from the so-called ‘frugal four’ – Holland, Sweden, Austria and Denmark.

In order to solve the budget crisis gripping the continent, the German Chancellor will host Mr Macron in the German town of Meseberg on June 29.

This comes as the French President met with Dutch Prime Minister, Mark Rutte to discuss the recovery fund and budget.

The proposed package would consist of €500billion (£451billion) in grants and €250billion (£225billion) in loans.

However, Mr Rutte has pushed for the package to be made up of more low-cost repayable loans in opposition to Brussels’s proposal.

Crucially, the proposed budget would need to be ratified by all EU states in order for it to be approved.

Last Friday, Mr Rutte raised further doubts on whether a deal could be reached at a summit in July.

He said: “It is uncertain whether it would be finalised then or whether we would need more sessions, and whether they should be during the summer or later.”

After meeting the Dutch Prime Minister, Mr Macron stated the bloc is “stronger together”.

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He added: “We have always been able to find constructive agreements with the Dutch prime minister.

“We have European fibre, we know that we are stronger together.

“I am confident that we will find common ground on the European recovery plan.”

In a further sign of the division in Europe, a poll in Dutch newspaper Bolkskrant from I&O Research found that 61 percent of the Dutch public did not support the EU recovery fund.

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In contrast, Ms Merkel has stated a failure to agree on the fund could lead to future problems within the EU.

With the UK departing the trade bloc, Ms Merkel insisted now was the time for solidarity across the continent.

If the EU 27 do not come together, she indicated populism could rise across the bloc.

Ms Merkel told German MPs this month: “The pandemic shows us how vulnerable Europe is.

“Therefore I want to stress to you that cohesion and solidarity in Europe were never as important as they are today.

“Anti-democratic forces, radical, authoritarian movements are only waiting for economic crises in order to misuse them politically.

“They are only waiting to incite social fears and spread insecurity.

“We must not allow the economic prospects of the EU member states to drift apart as a result of the pandemic.”

Although the EU has put forward the vast recovery fund, there have been serious divisions between states within the bloc.

Both Italy and Spain have registered the highest death tolls on the continent and criticised the bloc for not acting quick enough during the pandemic.

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