Eurozone splits over response to impact on business

EUROPEAN GOVERNMENTS remain at loggerheads over measures to help the economy, with officials breaking off meetings as representatives clashed over aid conditions.

Finance ministers from 19 different countries which use the euro spoke late on Tuesday evening, but have had to postpone an announcement until today at the earliest.

European governments are scrambling to put together a package to save lives as well as companies and families from going bankrupt, but many countries hit hardest by the virus are also those that can least afford the costs, like Italy and Spain.

France’s central bank said the country has entered recession with a six per cent drop in the first quarter and German economists predict the economy will shrink 4.2 per cent this year.

Italy and Spain, backed by France, want to throw all the EU’s economic might into fighting the virus and disruption it has caused as soon as possible.

On the table is a three-part package amounting to around £440bn, consisting of emergency loans, credit guarantees, and support for short-work schemes.

Italy has rejected using the bailout fund, on the grounds that it comes with conditions to carry out economic reforms, arguing that the virus is no country’s fault and with Prime Minister Giuseppe Conte dismissing it as “totally inadequate”.

Germany has proposed waiving most conditions, but the Netherlands has pushed for reform promises.

French finance minister Bruno Le Maire stressed the importance of getting a deal: “I strongly believe that our shared responsibility now is to reach an agreement within the next 24 hours. A failure is inconceivable.”