Loans from the European Stability Mechanism (ESM), tentatively agreed to by EU members as a measure of economic relief amid the COVID-19 pandemic, pose a threat to Italian sovereignty and may not be of any use for the country, Manuel Vescovi, a member of the Italian upper house from the Lega party, told Sputnik
GENOA (Pakistan Point News / Sputnik - 10th April, 2020) Loans from the European Stability Mechanism (ESM), tentatively agreed to by EU members as a measure of economic relief amid the COVID-19 pandemic, pose a threat to Italian sovereignty and may not be of any use for the country, Manuel Vescovi, a member of the Italian upper house from the Lega party, told Sputnik.
Late on Thursday, the finance ministers of the EU member states agreed on a package of measures to ensure the recovery of the bloc's economy from the pandemic. They will have to be approved at the next meeting of EU leaders. The package, worth 540 billion euros (over $590 billion), includes a new European Investment Bank program with 200 billion euros worth of support to enterprises, the SURE mechanism of the European Commission to fight unemployment totaling 100 billion euros; and a loan instrument worth 240 billion euros from the ESM.
"We are very much opposed to the ESM: it means taking away our sovereignty, it means contributing to something that will never give us any help, it means putting billions into something that will not give us a hand. Europe must totally revise its economic policy and how it is managed if this is how it is," Vescovi said.
Italy was among several EU states that have proposed issuing so-called coronabonds � eurobonds that will help overcome the economic consequences of the coronavirus pandemic.
However, the eurobonds were set aside from the agreed package of measures, though they were Italy's main aspiration. The Netherlands, in its turn, was among the main opponents to the idea of the eurobonds.
The Netherlands has "put Italy in check," Vescovi added, using chess terminology.
"Now they want to put us in trouble with the ESM, it means that Italy allows the control over it by the Netherlands and by certain mechanisms that do not bring Italy any good," he said.
It was tentatively agreed that ESM loans would not be conditioned by any demands of austerity measures and public debt reduction, which is important for Italy, whose public debt is the second biggest in the European Union after Greece. The loans will also have a low interest rate but will be required to be used only for health care needs linked to the COVID-19 crisis.
