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Dutch propose emergency fund for coronavirus nations

FILE PHOTO: Dutch Prime Minister Mark Rutte speaks during a news conference in the Hague, Netherlands March 19, 2020. REUTERS/Eva Plevier

AMSTERDAM (Reuters) - The Netherlands on Wednesday proposed establishing a fund for nations worst hit by the new coronavirus and has asked other countries in the European Union to contribute, Dutch Finance Minister Wopke Hoekstra said.

The Netherlands was criticised by southern European countries who accused it of lacking solidarity in its response to the coronavirus.

“What we are proposing is a healthcare emergency fund to which the Netherlands would make a very substantial contribution,” Hoekstra told Reuters.

“It would be roughly a billion euros and that would be a gift as a sign of solidarity intended for countries dealing with the coronavirus,” he said.

The Netherlands received positive reactions from other nations within the 27-member bloc to the proposal, Hoekstra said.

Dutch Prime Minister Mark Rutte told parliament earlier on Wednesday the Netherlands preferred to make a “gift” to European countries in financial distress as a result of the COVID-19 pandemic rather than issue joint bonds or tap the European Union’s bailout fund.

Rutte said he would prefer setting up a new support fund rather than having countries use the European Stability Mechanism (ESM).

“If you do (support) from the ESM, then it’s a loan and a loan must be paid back,” he said. “If you do it as a gift, then it’s: ‘Listen, you guys have been hit hard, but together with a number of wealthier countries, we’re prepared to bear the direct costs of the coronavirus crisis’.”

Rutte said he hoped to repair diplomatic ties with Italy and Spain following a perceived lack of empathy during EU crisis conversations last week.

Reporting by Toby Sterling; Editing by Hugh Lawson and Grant McCool