The Bank of France reported Wednesday morning that the country’s economy has shrunk 6 percent in the first quarter of 2020, its worst performance since 1945, due the coronavirus lockdown.
French economy minister Bruno Le Maire met on Wednesday with finance and economy ministers from 19 European Union states sharing the euro currency. The group failed to agree on a bailout plan to help those countries hardest hit by the Covid-19 pandemic.
“After 16 hours of negotiations, no deal in the Eurogroup on the economic response to the coronavirus crisis,” Le Maire tweeted.
Ministers have tentatively approved the use of the European Stability Mechanism (ESM), established in 2012, to issue loans of up to €240 billion that would help stimulate the economies of EU countries most impacted by the current health crisis.
But Italy says Eurobonds offer only a short to medium-term response and Italian prime minister Giuseppe Conte is seeking a longer-term debt-sharing solution
However, according to AFP, Germany, the Netherlands and other northern countries including Austria, Denmark, Sweden and the Baltic States, have flat out rejected any debt-sharing with countries in the south that already have huge public debt, as they consider them to be “undisciplined in financial management.”
AFP cited sources claiming that France, Greece, Ireland, Luxembourg, Malta and Spain have proposed to create a coronabond fund. France offered “renewal funds” as a compromise, limiting the shared debt to essential public services or fragile sectors. Talks are set to resume tomorrow.
And some good news from the banking sector. Barclays announced yesterday its new Barclays Foundation, which will provide a Covid-19 Community Aid Package of £100 million to charities working to support vulnerable people impacted by the pandemic.
Barclays Group CEO, Jes Staley, commented, “We want to do more to back the communities in which we live and work, and to provide help to those who have been hardest hit by the consequences of the coronavirus pandemic.
“That’s why we’ve launched this community aid package, which we hope will make a positive difference, working with charity partners here in the UK and around the world to deliver help where it’s needed most.”
Since the beginning of the coronavirus turmoil, Barclays has made available free everyday banking and overdrafts to 650,000 small businesses and has waived overdraft and other fees for customers in the UK.