EU Leaders Meet for Tense Summit Over €750 Billion Coronavirus Recovery Fund

Today, EU leaders met in Brussels to discuss Europe's €750 billion coronavirus recovery plan, after weeks of disagreement over the economic rescue fund.

It was the first in-person meeting of all 27 EU heads since the beginning of the pandemic. Masks were worn, hand sanitiser was dispensed and elbow bumps were offered in place of the traditional handshakes and cheek kisses. But while the greetings were polite, the summit was set to be tense.

French President Emmanuel Macron and German Chancellor Angela Merkel support EU plans to borrow hundreds of billions of euros to stimulate the European economy. However, the so-called "frugal four" – the Netherlands, Sweden, Austria and Denmark, all wealthy northern European countries – want to reduce the size of the package and bolster the screening process ahead of granting aid. They also want to discuss how the money is raised – via taxes or through financial markets – and have demanded that certain countries commit to economic reforms as a condition for receiving the funds.

Ahead of the talks, Chancellor Merkel – who currently holds the EU's rotating presidency – said, "I must say that the differences are still very, very big. I expect very, very difficult negotiations. Germany will weigh in – together with France, of course – to assist [European Council president Charles] Michel."

"The stakes couldn't be higher," said European Commission President Ursula von der Leyen. "The whole world is watching us, [to see] whether Europe is able to stand up united and to overcome this corona-related crisis strongly."

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Ahead of the talks, rifts were expected around the values and ideologies of each leader involved. Some Western European countries, for instance, are demanding stronger preconditions for countries such as Hungary and Poland, which have been accused of undermining the freedom of press and reducing the rights of LGBTQ people. Hungarian Prime Minister Viktor Orban has said he will veto any deal that requires member states to respect the EU's fundamental values – which include human rights, democracy and equality – as a condition of receiving aid.

Another issue to debate is how exactly the money is distributed: some countries that have been hit hardest by the pandemic, including Italy and Spain, want a larger share of the package. Furthermore, a number of Mediterranean countries want the money allocated as free grants instead of repayable loans – a suggestion opposed by the "frugal four".

Greek Prime Minister Kyriakos Mitsotakis said, "The big picture is that we are faced with the biggest economic depression since World War Two. Maybe some compromises will be necessary, but we need […] an ambitious solution, because our citizens expect nothing less from us."

The number of disagreements at play has prompted commentators to suggest no deal will be reached by the end of this weekend. Austrian Chancellor Sebastian Kurz told Reuters he was optimistic a deal would be made – and, if not, that leaders would hopefully be able to agree by the end of another summit in Brussels before the end of July. Luxembourg Prime Minister Xavier Bettel said he had brought a spare shirt with him, in case an extra day was needed.