Macron Says France to Get $46 Billion From EU Stimulus Deal

Emmanuel Macron said France will receive 40 billion euros ($46 billion) after European Union leaders agreed on an unprecedented 750 billion-euro recovery fund to help the bloc overcome the economic fallout from the coronavirus pandemic.

According to the French president, it won’t cost his country’s taxpayers a cent as the deal stipulates that the EU will be able to levy taxes “on large companies and international players who do not play ball.” Macron referred specifically to a plastic tax, a renewed effort to create a digital tax at the EU level and a border adjustment mechanism linked to carbon emissions.

“We have reached a historic deal for our Europe. It is the fruit of three years of work with Germany,” said Macron in a television interview on TF1. “It is the most important moment in the life of our Europe since the creation of the euro.”

The plan will see the bloc’s executive arm raise debt on behalf of the entire EU, with 390 billion euros to be distributed in the form of grants and another 360 billion euros disbursed via low-interest loans. Almost a third of the funds are earmarked for fighting climate change. The fund will be financed by joint debt issuance, marking an unprecedented deepening of financial integration for the bloc.

The grants portion has been trimmed down from an initial 500 billion euros originally proposed by France and Germany, under pressure from four fiscally hawkish northern countries led by the Netherlands.

After days of tense talks, the 27 national delegations finally broke the impasse in the early hours on Tuesday between these fiscal conservatives and a majority led by Germany and France, who want decisive action to help the predominantly southern nations hardest hit by the recession.

©2020 Bloomberg L.P.

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