“It would be best if we could reach an agreement before the summer break,” Merkel said, calling for compromise from member states to enable the deal to be ratified by the end of the year.
“We must act quickly and decisively,” she said.
Merkel's speech came as Germany prepared to take over as chair of the EU council between July 1st and December 31st.
“Our Europe is vulnerable. Cohesion in Europe has never been more important than it is today,” said Merkel. “No country can face this crisis in isolation and alone.”
Out of a recession
European Commission chief Ursula von der Leyen proposed the huge fund to help the EU out of its deepest-ever recession, but the plan was immediately met with fierce opposition from fiscally conservative member states including Austria and the Netherlands.
The proposed package consists of €500 billion in grants and €250 billion in loans, but requires unanimous EU approval.
“The starting position is far from easy but I hope that all member states will act in a spirit of compromise in the face of this unprecedented situation,” Merkel said.
The European Council is due to hold a video summit on June 19th on the controversial stimulus package, the EU's largest to date.
However, a decision is not expected until the leaders have met in person, said Merkel.
'Make Europe strong again'
The German chancellor had in late May stunned observers by proposing along with French President Emmanuel Macron the plan for €500 billion in grants to help the hardest hit EU members to get their economies back on track.
That proposal, now making up the bulk of von der Leyen's package, shattered a long-standing German taboo as it included taking on shared debt, a dramatic U-turn after years of obstinate German opposition to joint borrowing.
Merkel resumed her speech by stating that Germany's motto in the EU Council is “Make Europe strong again.”
“We must not allow the pandemic to cause EU member states to drift apart and weaken the internal market,” said Merkel. She added it was important to prevent a permanent “deep rift running through Europe”.
She added that radical forces would use moments of weakness in Europe to stir up social anxiety and create insecurity.