Recovering from the EU’s Recovery Fund
Amid the celebrations following European leaders' deal on a €750 billion recovery fund, many seem to have forgotten that both the European Union and the eurozone remain under constant threat of sovereign-debt crises. Until that fundamental weakness is addressed, the champagne corks should stay in their bottles.
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NEW YORK – After arduous negotiations between member states’ governments last month, European Union leaders are celebrating their agreement on a €750 billion ($886 billion) rescue package for EU countries hit hard by the COVID-19 crisis. But it is too soon to pop open the champagne. The plan for the “Next Generation EU” recovery fund has two major weaknesses that will make it not only ineffective but also a threat to the eurozone’s very existence.