Four EU states formally oppose Merkel-Macron plan for coronavirus grants

EU member states Austria, Sweden, Denmark and the Netherlands stated their opposition on Saturday to a French-German plan for a 500 billion euro ($545 billion) coronavirus recovery fund that would issue grants, calling for a loans-based approach instead.

French President Emmanuel Macron and German Chancellor Angela Merkel made the surprise proposal on Monday to set up a fund that would offer grants to European Union regions and sectors hit hardest by the pandemic.

The idea of grants, however, is anathema to the EU’s self-styled “frugal four”, who generally oppose big spending and fear the proposal will lead to a mutualization of member states’ debt.