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MNI SOURCES: EU Sees Pandemic Credit Line Ready By June

--Officials Confident Credit Line Will Be Ready By June
--SURE Unemployment Insurance May Be Delayed Days Or Weeks
By David Thomas
     BRUSSELS(MNI) - European Union officials are confident they can finalise
details of a pandemic credit line programme in time for it to be available to
all euro countries from the start of June, though challenges remain over how
loans will be checked to ensure that they are spent only on the direct
healthcare costs, they told MNI.
     "You can see there is convergence, there is no major obstacle to agreement,
not like at the beginning of April when the Italians had serious objections to
the credit line idea," a senior EU source said.
     Italian officials are still concerned the EU Commission could tighten loan
conditions once the pandemic is over. The Commission has apparently assured
Italy that this is not in fact the case.
     "The pandemic credit line couldn't possibly be used as a basis to ask a
country to apply a macroeconomic programme," the official said.
     Meanwhile, another pillar of the Eurogroup's EUR500-billion rescue plan
looks like being delayed. The EUR100 billion SURE program which provides EU
financing for firms on temporary unemployment schemes may not get underway on
June 1 because of the impact of Covid lockdowns on national legislatures, all of
which need to approve the scheme.
     "The likelihood is that the guarantee schemes will not be there by June," a
senior EU source said.
     However, the source added that they were confident that any delay would
only be for "a few days or weeks."
     Talks between the Commission and member states on the former's recovery
fund proposal continue. Big net contributors like Germany, Netherlands, Sweden,
Denmark and Austria are still apparently baulking at increasing the direct
grants element of the proposed stimulus package. The proposal had been slated
for release but this has now been pushed back to May 20 as negotiations
     Eurogroup ministers will meet again on May 15 when they will hold an
'orientation debate' on the recovery plan. The idea of the discussion is to give
the Commission some sense of the centre of gravity among member states on the
     "UvL (Commission President Ursula von der Leyen) is finding it difficult to
get agreement among the member states," said one source familiar with the talks
on the fund.
--MNI London Bureau; +44 203 865 3829; email:
[TOPICS: M$X$$$,MC$$$$,MT$$$$,MX$$$$,M$$EC$,MFX$$$,MGX$$$]

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