Matthew Lynn Matthew Lynn

Macron and Merkel’s coronavirus rescue fund is a stitch-up

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It is finally here. Die-hard European Union federalists have plotted for it for years. Economists and thinks tanks have argued for it. The Greeks and Italians have pleaded for it. And French presidents have made no end of grand speeches, full of references to solidarity and common visions, proposing it. The Germans have finally relented and agreed, at least in part, to share debt within the EU and the euro-zone, and bail-out the weaker members of the club.

France’s president Macron and Germany’s chancellor Merkel last night agreed a 500 billion euro (£450bn) plan that will re-distribute fund from the stronger members to the weaker. There is a problem however. It will make a British exit without a deal a lot more likely. And the terms of the deal are so punishingly unfair, it will drive an irreparable wedge between the euro and non-euro countries.

The Merkel-Macron plan is certainly a big step forward.

Matthew Lynn
Written by
Matthew Lynn
Matthew Lynn is a financial columnist and author of ‘Bust: Greece, The Euro and The Sovereign Debt Crisis’ and ‘The Long Depression: The Slump of 2008 to 2031’

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