Economic Affairs

Relief, but eurobond still falls short

The EU's new 'recovery package' only buys time

The leaders of the European Union have a well-deserved reputation of taking tough but essential decisions only during times of crisis, and they have lived up to it yet again.

On July 21, after months of rancorous haggling, they agreed to launch what is effectively a eurobond - that is, a bond that would be issued by the EU itself, rather than by its individual member governments. Up till then, the EU didn't believe in taking collective responsibility for the debt burdens of its individual members - every country was responsible for its own debts. But that has changed - at least partially and temporarily.

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A version of this article appeared in the print edition of The Straits Times on August 05, 2020, with the headline 'Relief, but eurobond still falls short'. Print Edition | Subscribe