Coronabonds: Germany urged to back joint EU debt to fight crisis

Two European Commissioners urged Germany on Monday to agree to the European Union issuing joint debt to fight the coronavirus crisis, as wealthy northern nations remain reluctant to back so-called coronabonds.

Coronabonds: Germany urged to back joint EU debt to fight crisis
Scholz speaking in Bavaria on Tuesday. Photo: DPA

“Like the European Central Bank in the monetary and financial sphere, the member states must now prove their joint decisive and innovative spirit,” internal market commissioner Thierry Breton and economy commissioner Paolo Gentiloni wrote in the Frankfurter Allgemeine Zeitung (FAZ) daily.

That could take the shape of “a European fund whose explicit function would make possible issuing long-term bonds,” Breton and Gentiloni suggested.

“Strictly limited to collective investments for industrial revitalisation in the context of the current crisis,” the instrument would be proof of “unshakeable solidarity” among EU nations, they argued.

READ ALSO: Germany 'ready for European solidarity' but won't back 'coronabonds'

A group of states including southern European heavyweights Italy, France and Spain have been imploring northerners like Germany, Austria and the Netherlands for common debt facilities to cushion the economic impact of the virus.

But conservative politicians in the north fear the plans would mean the eventual mutualisation of all sovereign debts and their taxpayers footing the bill for supposed southern profligacy.

Finance ministers from the 19 euro single currency member states will meet Tuesday to again seek a solution to the deadlock.

German Finance Minister Olaf Scholz on Friday proposed a three-pronged scheme including cheap loans from the financial crisis-era European Stability Mechanism (ESM), cash from the European Investment Bank and an EU-wide unemployment reinsurance scheme, skirting the issue of joint debt.

And EU Commission President Ursula von der Leyen on Friday promised a post-crisis “Marshall Plan” for the bloc funded through its existing joint budget, whose next seven-year period runs from 2021-27.

Responding to Scholz's plans, Breton and Gentiloni argued Monday that a “fourth pillar” of financial aid would be needed to master the crisis, “given the size of the sums involved”.

Also in the FAZ and France's Le Figaro Monday, Bundestag president Wolfgang Schaeuble and his French counterpart Richard Ferrand called for “more solidarity and fiscal integration” in Europe.

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‘People liked the silence’: How Berlin’s club scene is struggling after lockdowns

Berlin's clubs are suffering from staff shortages, a lack of guests... and neighbours who've grown used to the silence, representatives for the scene say.

'People liked the silence': How Berlin's club scene is struggling after lockdowns

Some operators from Berlin’s club scene are bracing themselves for a difficult autumn. For months now, people have been allowed to dance again and life has returned to normal in the dark corners of Berlin’s famous nightlife scene.

But the clubs have far from recovered from the pandemic. They face staff shortages, rising prices and the prospect of a return to Covid restrictions in the autumn.

“We go into the autumn with huge fear, because the omens are totally unfavorable,” said association head Pamela Schobeß.

Spring and summer went anything but smoothly, she said. “There has been an oversupply of events. People aren’t going out as much, and some are still afraid to move around indoors.”

Money is also an issue. “A lot of people are afraid of rising energy prices.”

The industry lost workers during the pandemic and it’s hard to convince them to come back with the outlook for the autumn looking so gloomy, Schobeß says.

Her colleague Robin Schellenberg tells a similar story. People have switched to various other jobs and would even rather work on a supermarket checkout, which may have been considered less sexy in the past. Now, he says, some have learned to love not having to work nights.


Schellenberg runs the Klunkerkranich, a small club on a parking garage deck in Neukölln. Because a number of things have become more expensive, they have also had to increase their admission prices.

His impression is that people are going out less often and are deciding more spontaneously. In addition, people in the neighborhood are now more sensitive to noise. “Many people found the silence very enticing,” he said.

Some in the industry wonder what will happen next. Will club admission have to become much more expensive? Will that exclude people who can no longer afford it? And what happens if Covid infection numbers rise sharply?

If masks become mandatory indoors in October, Schobeß believes that would be bad for the clubs. “Even if we don’t get shut down by the state, we’ll actually have to close down independently ourselves,” she reckons.

Masks take all the joy out of the experience, she says. People have drinks in their hands and are “jumping around and dancing” and then security guards have to tell them “please put your mask on.”

The federal government is considering whether states should be able to make masks mandatory indoors starting in October. Exceptions should be possible, such as at cultural and sporting events, for people who have been tested, recently vaccinated and recently recovered.

In the event that Covid numbers soar, the states could then be allowed to tighten the rules and eliminate all exemptions.

READ ALSO: German court declares techno to be music