THE HAGUE, April 1 — Dutch Finance Minister Wopke Hoekstra acknowledged yesterday that the Netherlands and some other EU countries had not expressed much empathy for southern Europe’s battle against Covid-19, but still declined to back common bonds.
Hoekstra spoke with private broadcaster RTLZ in reference to a meeting of eurozone finance ministers last Thursday where northern countries rejected a request by others for a common bond issuance to help countries like Italy and Spain weather the crisis.
“We were not empathetic enough, to the point that it has raised resistance,” Hoekstra told RTLZ.
“We did not succeed in conveying what it is we want to do,” he added.
Hard-hit countries including Italy and Spain called for eurozone members to band together in a common bond issue, quickly dubbed “corona bonds”.
But the Netherlands, Germany and other northern European countries consider the idea an attempt by southern partners to benefit from cheap borrowing rates afforded to states with balanced budgets.
Deficit-leery northern countries would rather see emergency funds come from the European Stability Mechanism, which provides loans to countries in financial trouble.
The problem for Italy, which has a public debt equivalent to around 130 per cent of GDP, is the strings that are attached.
Finance officials in Rome and Madrid are also wary of the negative impression that seeking a huge amount of assistance would give.
“Our position on corona bonds was firm, but our position on solidarity was not,” said Hoekstra.
“We want to find a way that is reasonable and sensible,” the Dutch minister added without elaborating.
Eurozone finance ministers are to meet again on April 7 by videoconference to try and agree on a common economic response to the crisis. — AFP