EU pledges $28 bln fund to tackle economic crisis due to coronavirus

European Commission President Ursula von der Leyen speaks during a press statement at the Berlaymont building in Brussels on March 10, 2020. (AFP)

The European Commission will set up an EU fund with a firepower of $28 billion ($25 billion euros) to tackle the economic crisis caused by the coronavirus outbreak, the head of the EU executive said on Tuesday.

Speaking after an emergency videoconference of EU leaders, Ursula von der Leyen said the investment fund should be financed with 7.5 billion euros of EU money and help vulnerable sectors of the economy.

“This instrument will reach 25 billion euros quickly. To realize this I will propose to council and parliament this week to release 7.5 billion euros of investment liquidity,” von der Leyen told a news conference in Brussels.

Money should start flowing in the coming weeks, she said, adding funds will be channeled to healthcare systems, smaller companies and the labour market.

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“We stand ready to make use of all instruments necessary,” the European Council President Charles Michel told the same conference.

He said EU leaders agreed to provide liquidity against the crisis. EU fiscal rules and regulations on state aid will also be relaxed to facilitate public spending, he added.

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