Yesterday’s European Union leader summit did not live up to expectations. Europe is faced with its biggest crisis since World War II. I am not just referring to the unspeakable human tragedy, where even wealthy countries are forced to make choices as to who lives and who doesn’t. But also to the economic tragedy created by the sudden stop in economic activity.
When it comes to protecting the nation’s health, each country has a responsibility towards its citizens and selects the measures it deems necessary. We did not hesitate to make tough choices with respect to social distancing earlier than most other European countries. So far, evidence suggests this was the right thing to do. But these restrictive measures have to remain in place until we are sure the worst is behind us.
But when it comes to the economy, Europe can do much more united. Increased resources will be needed to support citizens and employment, as well as to extend help to affected businesses. And this will be taking place against falling state revenues. Undoubtedly, Europe will have to borrow more, to be able to spend more.
Together with eight fellow leaders of state we signed, yesterday, a letter, asking for preparatory work on issuing a special Eurobond aimed at fighting this unparalleled crisis. Argumentation is simple: the Coronavirus represents a symmetric shock for all. It therefore requires a common response that will allow the European Union to borrow large amounts at low cost, for the benefit of all member states.
There are no “prudent” or “reckless” here, those responsible or irresponsible. We are all faced with the same threat, “we are boiling in the same pot”. 2020 is not 2010 …
Unfortunately, some countries insist on fighting today’s unprecedented crisis with the outdated weapons of yesteryear. This will not do. The ECB cannot be responsible for everything and overburdening it, can only increase financial risks later. And the ESM was not designed for such unprecedented crises.
The discussion with respect to special purpose Eurobonds (corona bonds) will open wide sooner or later. But Europe cannot be left behind. If we fail to act now, promises of solidarity will ring hollow. Meanwhile, our inaction can offer fertile ground to enemies of the European ideal. But this need not be. We can renew Europe through this adventure and let a new dynamic shine through when this has been overcome.
My words are not, just, the words of the Prime minister of Greece, a country that battled and came through a decade-long economic challenge. They also reflect the thoughts of a citizen of Europe, that cares deeply for its future.
This is the moment for mutual understanding, joint initiatives and rapid action. A moment of great responsibility. Unprecedented crises call for unprecedented decisions. Let’s take them!
