Netherlands Won’t Block EU Recovery Plan, German Envoy Says

(Bloomberg) -- A senior German official said the Netherlands will scrap its penchant for parsimony as European leaders negotiate a vast recovery plan to fight the coronavirus pandemic.

Michael Roth, a deputy foreign minister in Chancellor Angela Merkel’s government, said he doesn’t expect the Dutch -- among the staunchest of the so-called “frugal four” nations demanding strict conditions in exchange for financial assistance -- to block a deal that’s essential to Europe’s future.

“It’s a traditional position of the Dutch to be very restrained when it comes to spending in the European Union,” Roth said in an interview with Bloomberg Television on Friday in Berlin.

“We need a clear signal of unity, but also of ambition. So I don’t think that the Netherlands will stand in the way of a compromise,” Roth said.

EU Council President Charles Michel stuck with a proposal to distribute 500 billion euros ($560 billion) in grants and 250 billion euros in loans. As a concession to the frugals, Michel proposed earlier repayments and the continuation of the bloc’s system of budget rebates.

Merkel, whose government has in the past been under fire for its spending restraint, met late Thursday with Dutch Prime Minister Mark Rutte in Berlin. The German leader offered a concession in saying that aid must be tied to economic reforms.

Roth didn’t play down the complexity of the talks over the plan as EU leaders gather for a summit meeting on July 17.

“It will remain difficult, but all member states are all aware that this is really about a lot,” he said.

©2020 Bloomberg L.P.