EU grapples over virus recovery plan, Barcelona in lockdown

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by Clement Zampa with Daniel Bosque in Barcelona

European Union leaders were due to meet for a third day Sunday to try and agree on a giant post-coronavirus economic recovery plan as four million residents of Barcelona in virus-ravaged Spain were effectively placed under lockdown.

The pandemic, which has spawned economic mayhem worldwide, also saw the G20 — the world’s most industrialised nations — consider extending debt relief for coronavirus-hit poor countries in the second half of 2020.

EU leaders in Brussels remained deadlocked Saturday over the COVID-19 recovery plan due to resistance from the Netherlands and its “frugal” allies: Austria, Denmark, Finland and Sweden.

European Council president Charles Michel was expected to propose another plan to the 27 leaders at noon (1000 GMT) Sunday after his blueprints for a 750-billion-euro ($850 billion) package were refused by the richer northern member states.

Michel’s latest proposal would keep the total recovery budget at 750 million euros, but shift the balance slightly from grants — down from 500 million to 450 million — to loans, which rise from 250 million to 300 million, according to a document seen by AFP.

Dutch Prime Minister Mark Rutte has insisted member states retain final approval of any funding — an effective veto — for recipients.

He says EU oversight is necessary to oblige countries like Spain and Italy to reform their economies to handle future crises better.

Michel’s latest plan includes a “super emergency brake” that gives any country a three-day window to trigger a review by all member states of another’s spending plans. (AFP)