EU Considers Providing Aid to Companies Ignored by Their Governments During the Corona Crisis

The European Union may start offering financial support to companies hard hit by coronavirus that are not able to receive financial assistance from their home governments, EU Economic Commissioner Paolo Gentiloni told Handelsblatt.

“This is important for pan-European value chains, for example in the car industry. If one link fails there, all the others are affected,” said the official, who also served as Italian prime minister from 2016 to 2018.

The measure would come as an additional instrument to the existing reconstruction plan that will be presented next week, the commissioner noted. On Monday, the EU’s two biggest economies, France and Germany, proposed to establish a 500-billion-euro Recovery Fund that would help corona-hit industries with financial grants. Some EU states, including Germany, believe that this support should come under the condition that its recipients, such as Italy, would first implement certain reforms. Former Italian PM Gentiloni, however, said during the interview that he did not believe that there was any “conditionality” around the financial assistance.

The emergency plan may turn out to be much more costly in the end, according to recent reports. It has been criticised by certain EU members in the north, including Austria, whose chancellor has recently argued that the most corona-affected countries should be helped by “loans” rather than simple grants.

The two-country initiative was still welcomed by many EU nationals and officials, including President of the European Council Charles Michel, but many social media users and tax payers remained sceptical regarding the proposal.

“Brexit is looking smarter and smarter”, Fox News TV host Laura Ingraham wrote on Twitter, commenting on the news.