April 1, 2020 / 4:00 PM / 2 months ago

Dutch PM prefers a 'gift' to a loan for European coronavirus support

Dutch Prime Minister Mark Rutte speaks during his news conference with newly appointed Health Minister Hugo De Jonge, who is taking over the function from Bruno Bruins since he resigned during the coronavirus disease (COVID-19) outbreak, in the Hague, Netherlands March 19, 2020. REUTERS/Eva Plevier

AMSTERDAM (Reuters) - Dutch Prime Minister Mark Rutte on Wednesday said he would prefer to make a “gift” to European countries in financial distress as a result of the coronavirus outbreak rather than issue joint bonds or tap the Eureopean Union’s bailout fund.

In a debate in the Dutch parliament, Rutte said he hoped to repair diplomatic ties with Italy and Spain after drawing criticism for a perceived lack of empathy during EU crisis conversations last week.

Rutte repeated that the Netherlands opposed the idea of “coronabonds” as a form of debt-sharing among EU members in response to the crisis. He said he would also 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’.”

Reporting by Toby Sterling; Editing by Hugh Lawson

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