Italian Prime Minister says the EU could collapse due to Covid-19 outbreak
Member states are divided on how to deal with the economic impacts of the outbreak.
Italy's Prime Minister Giuseppe Conte has said the European Union risks failing as a project due to the Covid-19 outbreak.
In an interview with the BBC, Conte said the scale of the problem should not be underestimated.
“We need an economic and social response at the European level,” Conte said. “It’s a big challenge to the existence of Europe.
“If Europe fails to come up with a monetary and financial policy adequate for the biggest challenge since World War II, not only Italians but European citizens will be deeply disappointed.”
Italy and Spain have been the EU countries hit hardest by the Covid-19 pandemic, with both countries approaching 150,000 confirmed cases and combined deaths of over 30,000.
Both countries, with the backing of France and others, have called for a shared bond issue backed by all member states which would allow for better terms, such as a low interest rate and a lengthy repayment period.
Basically, this would involve sharing debt related to the coronavirus and all EU nations would help to pay it off.
However, such a response has not proved popular with historically fiscally prudent states like The Netherlands and Germany, who have opposed the proposal along with a number of other northern countries.
Italy has rejected using the bailout fund, the European Stability Mechanism. Dipping into the fund obliges the nation to implement austerity as part of the agreement.
Tensions between member states have risen during the Covid-19 pandemic with clashes over economic response, as well as over medical equipment and border checks within the EU, testing the unity of the states.