The aid that EU countries provide to their citizens and businesses to pay for energy bills must be temporary, targeted, cost-effective and targeted at the vulnerable and towards sustainability. Minister Sigrid Kaag presented this to her colleagues from the euro countries at a meeting of the Eurogroup in Luxembourg.
The ministers provided text and explanations on their national support packages. The huge aid package of 200 billion euros that Germany has announced does not go down equally well across the EU.
Because rich countries, such as Germany and the Netherlands, can handle a lot financially but others cannot, there is a risk that the energy crisis will drive a wedge between the EU member states, said French minister Bruno Le Maire. Le Maire calls for 20 billion euros of EU subsidies to be used to support those weaker countries. He also believes that the energy crisis requires a global response.
According to Eurogroup President Paschal Donohoe, the euro area’s finance ministers (the Eurogroup) are becoming increasingly aware of the importance of coordinating support measures, for example to prevent unfair competition between companies in different countries. In a joint statement, they also say they will not pursue policies that can drive inflation even further. Last month, it averaged 10% in the eurozone.
Kaag pointed out that the governments are “balancing on a thin cord”. By supporting their citizens and businesses as much as possible, there is a risk that debts will increase further. She warns that debt sustainability must be kept in mind.