Premier Giuseppe Conte said at a press
conference with Premier Pedro Sanchez in Madrid Wednesday that
the two countries agreed a Recovery Fund deal must be found by
the EU by the end of this month.
The two leaders also said the COVID emergency has united Italy
and Spain more than ever.
Conte stressed that Madrid was the second stage, after Lisbon,
of his tour of EU capitals to drum up support for a Recovery
Fund deal.
He said the trip "has boosted our conviction that we must work
in harmony".
Conte said "we must finalise the package of EU measures by the
end of July"
He said there should be "no giving way" on the European
Commission's initial proposal of a 750 billion euro fund to
come more in grants than loans.
Conte said an "elevated" response was needed from the EU, and
not a "compromise among the 27".
The Italian PM said "we have to dare, we must not be indulgent".
"The single market is at stake here, unless we find a deal we
will destroy it".
Sanchez, too, told the press conference that the EU must reach a
deal on the COVID emergency Recovery Fund by the end of this
month.
"We need a joint response from Europe," he said alongside Conte.
"There can be no other moment for the accord than beyond this
month".
Conte is continuing to firm up Spanish and Portuguese support
for Italy's stance on the EU's planned Recovery Fund, after
flying from Lisbon to
Madrid.
Political sources said there was full agreement between the
three countries that there should be a swift European response,
with a deal by the end of this month.
Italy, Spain and Portugal also agree that most of the funds must
come in grants rather than loans, according to the European
Commission's original 750 billion euro proposal.
Northern European countries, on the other hand, are pushing for
more loans than grants and have said there is no great hurry for
an agreement.
On Tuesday Conte stressed the need for a reaction to the COVID
crisis, which risks destroying the single market, saying "if
some countries have greater difficulty, all the others will
suffer as a consequence".
Sanchez said an agreement on the Fund could and must be reached,
in an interview with Corriere della
Sera newspaper Wednesday.
Sanchez spoke of a pact for Europe between Italy and Spain.
He added that Madrid for now has adequate access to credit and
will therefore not resort to the European Stability Mechanism
bailout fund.
Italy, too, has been cautious about using the ESM, with some in
government saying that a no strings attached promise may not
turn out to be accurate
Conte, for his part, has said it is up to parliament to decide
whether Rome should tap into the ESM for COVID-related spending.
Sanchez said in Madrid Wednesday, however, that "we must not be
ashamed to use the ESM".
Conte said that proposals on using the ESM should be examined
after the end of EU negotiations.
He said it was "ideological" to say at the current stage whether
the ESM should be used or not.
German Chancellor Angela Merkel, for her part, said that a deal
on the Recovery Fund must be reached by the end of the summer.
Economy Minister Roberto Gualtieri, for his part, told a
Bloomberg online forum that Italy would only use state
intervention when necessary and it had shown a courageous
response to the health emergency.
Gualtieri said Italy would use the ESM if necessary, saying
there was no stigma attached.
Austrian Chancellor Sebastian Kurz met with other 'frugal'
leaders from Denmark, the Netherlands and Sweden in a
videoconference Wednesday and said they had coordinated their
stance on the Recovery Fund.
He said he was looking forward to meeting them again in person
in Brussels at a July 17 summit.
The four countries are leading a push for funding to be handed
over as loans with strings attached, such as structural reforms.
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