Merkel and Macron urge ‘strong’ recovery fund for Europe

German Chancellor Angela Merkel and French President Emmanuel Macron on Monday called for a "strong" and "efficient" coronavirus recovery fund for the European Union, urging a deal to be sealed next month.

Merkel and Macron urge 'strong' recovery fund for Europe
Merkel and Macron speaking in Meseberg, Brandenburg on Monday evening. Photo: DPA

The two leaders met for talks at the German government retreat in Meseberg, days before Germany takes on the rotating presidency of the bloc with an economy mired in the worst crisis since World War II.

Berlin's chairing of the 27-member bloc will be the last with Merkel in charge, and could be the one that defines the legacy of the leader dubbed the “eternal chancellor”.

With the future of the bloc's relationship with Britain still to be determined, a shift to a lower-carbon world in the balance and deteriorating US-China ties all jostling for attention, there is no shortage of issues to

READ ALSO: Merkel and Macron to meet as Germany takes on high-stakes EU presidency

But it is the coronavirus pandemic and the economic devastation it has wrought that will concentrate minds.

At talks at the German government retreat in Meseberg, both leaders made a push for €750 billion recovery fund proposed by European Commission chief Ursula von der Leyen.

The Franco-German pair had sketched out the backbone of the fund but it has run into opposition from so-called “frugal nations” like the Netherlands and Austria.

Hard-hit southern European countries such as Italy and Spain have called on the EU to loosen its purse strings in the response to the crisis.”We hope we'll find a deal (in July), even if the road is still long,” said Merkel.

“What is important for me is that we come out of the debate with a strong instrument. There will of course be changes that must be discussed. But it must remain a fund that… really helps countries that are hardest hit by the crisis.”

Macron had blunt words for the hold-out nations, warning that it would “not be in their interest to see certain members — in particular, members of economic significance in the European economy — affected” by a scuppered deal.

“So it's solidarity to have this transfer but also it is in their own interests.”

German 'bulldozer'

Germany takes on custodianship of the bloc with a strong hand as it has withstood the health emergency better than most other member states.

Once an obstinate champion of budgetary rigour, Merkel's government has ditched its no-new-debt dogma to throw resources at the crisis.

Its programme to shore up the German economy totals more than one trillion euros in spending, loans and guarantees.

Together with Macron, Merkel last month proposed a massive recovery fund to jumpstart the bloc's economy.

The fund would offer grants with no repayment obligation to countries hardest hit by the pandemic, a major policy U-turn for Berlin.

With an eye on the devastating blow taken by Spain or Italy, Merkel had said that it was “imperative that Germany not only thinks of itself but is prepared for an extraordinary act of solidarity”.

On Monday, she noted that perhaps sceptical nations could be placated as long as beneficiary nations took action at home to improve their economy.

“What is very important for many that are still sceptical is the wish that we all come out of the crisis strong,” she said.

“That means that the work with a financial plan for Europe and a recovery fund alone won't be enough, but that everyone looks at home how they make themselves resistant for the future.”

'Swan song'

Observers have said that they believe Berlin will ram through an accord.

An EU diplomat agreed, saying: “On the recovery fund, I expect Germany to dictate the whole process. Merkel is holding all the cards and (EU Council chief) Charles Michel will follow that.

READ ALSO: Merkel wins surprise backing from Germany over EU aid U-turn

“She also wants to get Brexit out of the way and she will always go for the deal as she wants to keep the West together. The third leg will be restoring ties with US after the election there.”

Merkel, who has ruled out running for a fifth term next year, will not have much time.

Brexit talks will have to be done by the year's end, and in November the focus will be on whether US President Donald Trump wins reelection.

What is clear is that Merkel's fingerprints will be all over the EU's roadmap.

“This will be a very Merkel presidency, her swan song,” said the EU diplomat, adding that she would be using it “to craft her legacy”.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.


French government votes to allow return of Covid tests at border

The French parliament has passed the controversial health bill which updates France's emergency provisions for Covid - and allows the return of negative Covid tests for all travellers at the border, if the health situation requires.

French government votes to allow return of Covid tests at border

The Loi sanitaire was eventually approved by the Assemblée nationale on Monday after several variations and amendments added on its passage through the Assemblée and the Senate. It was voted on and passed Tuesday, May 26th. 

The bill replaces the State of Health Emergency that has been in place since March 2020 and puts in place provision for government actions should the health situation deteriorate or a dangerous new variant of Covid emerge.

The original text had a provision for the return of the health pass at the border, but this has now been scrapped and instead the government has the right to make a negative Covid test a condition of entry for all travellers.

At present negative tests are required only for unvaccinated travellers, and the new test requirement would only be put into force if a dangerous new variant emerges.

The government will be able to implement the testing rule by decree for two months, but a further parliamentary debate would be required to extend it beyond that.

From August 1st the State of Health Emergency will be formally repealed, which means that the government no longer has the power to introduce major limits on personal freedom such as lockdowns or curfews without first having a debate in parliament.

The bill also allows for an extension of data collection required for the SI-DEP epidemic monitoring tools such as the contact tracing app Tous Anti Covid until June 30th, 2023 and Contact Covid until January 31st, 2023. 

The most controversial measure in the bill was the reinstatement of healthcare workers who were suspended for being unvaccinated – this actually only involves a couple of hundred people but medical unions and the medical regulator Haut Autorité de Santé (HAS) have both been against it.

However the bill allows for the eventual lifting of the requirement for Covid vaccination for healthcare workers, when the HAS judges it is no longer necessary and once the requirement is lifted, the suspended healthcare workers will be reinstated “immediately”.

The bill was approved on Monday evening with 184 votes to 149, the result of a joint committee that was able to harmonise the versions of the Assembly and the Senate.

The final vote passed the Senate on Tuesday.