ATHENS (Reuters) – Spain’s Prime Minister Pedro Sanchez on Sunday renewed his call for debt mutualisation, saying it will help Europe better compete with other countries around the world.
In an interview with Greek To Vima newspaper published on Sunday, Sanchez said that an agreement by the European Union on an unprecedented 750 billion euro ($912 billion) plan to finance the recovery of the block from the coronavirus pandemic has been a “great success”.
However, Europe still needs to work to deepen its fiscal integration through a common banking and capital markets union.
“A European fund and the full mutualisation of debt are important issues so that we make a leap of high quality in the future of the EU,” Sanchez said ahead of an official visit to Athens.
“Otherwise, we risk being left behind in a world which is becoming more and more competitive.”
Spain and Greece, with a high debt-to-GDP ratios, would benefit from some sort of collective borrowing which would ensure that their economies have equal chances of recovering from the pandemic with other less indebted countries.
However, Germany, among other nations, has long been opposed to issuing common debt with other European nations, arguing that it would stop individual countries from pursuing structural reforms and balancing their budgets.
Spain and Greece, two popular tourist destinations in the Mediterranean, have also backed a joint EU vaccine certificate that will make it possible for travellers to prove they have been vaccinated against, or tested negative for, COVID-19.
Sanchez hoped that the so-called “green pass” will be ready ahead of the summer holiday season.
($1 = 0.8222 euros)
(Reporting by Angeliki Koutantou; Editing by Raissa Kasolowsky)
