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WORLD NEWS Wednesday 22 July 2020
Stimulus package breaks new ground in European unity

By DAVID McHUGH fordable rates.
FRANKFURT, Germany (AP) Resistance from the Neth-
— European leaders took erlands, Austria, Sweden,
a historic step towards Finland and Denmark re-
sharing financial burdens flects skepticism about the
among the EU's 27 coun- pace of economic reform
tries by agreeing to borrow in the countries that need
and spend together to pull help.
the economy out of the Yet the trillions in financial
deep recession caused by support are starting to add
the virus outbreak. up. Although the European
Pushed by Germany's An- response is spread across
gela Merkel and France's EU institutions, the Europe-
Emmanuel Macron, lead- an Central Bank, and the
ers agreed to borrow jointly individual nations govern-
by selling bonds, using the ments, economists say the
European Union's collec- stimulus figure is weighty
tive strong credit rating enough to impress interna-
that keeps interest costs tional investors so they will
low. The money will fill a 750 keep lending to indebted
billion-euro ($855 billion) re- countries such as Italy and
covery fund to be used to avoid another debt crisis.
boost the hoped for eco- The 750 billion euro recov-
nomic rebound next year ery fund comes on top of
through 2023 and restore a 1.1 trillion euro, seven-
the growth and jobs lost in German Chancellor Angela Merkel, second right, speaks with, from left, Greek Prime Minister year EU budget that pays
Kyriakos Mitsotakis, Spain's Prime Minister Pedro Sanchez, Portugal's Prime Minister Antonio Costa
this year's plunge. and Romania's President Klaus Werner Ioannis during a round table meeting at an EU summit in for the union's agricultural
Two decisions - shared bor- Brussels, Tuesday, July 21, 2020. support, projects to help
rowing, and simply handing Associated Press poorer members catch
out over half the money up and myriad other pro-
as grants - broke through berg bank. "Near-term, cued with loans that have and the fund is a one-off, grams. That, in turn, follows
longstanding opposition the confidence effect can to be repaid, increasing its meaning that while it sets up to 540 billion euros in aid
from some of the finan- matter even more than the debt load. That help came an important precedent it for wage support programs
cially stronger countries money itself." with tough conditions to does not necessarily lead to hold down unemploy-
to exposing their finances The EU's executive com- rein in government spend- to ongoing mutual support ment, and credit lines that
and taxpayers to troubles mission predicts the bloc's ing that reduced growth, that could be counted on hard-hit countries could
in southern Europe, where economy will shrink by 8.7% spread hardship and fu- in any future crisis. tap from the eurozone's
bureaucracy and red tape this year and rebound by eled resentment. The grant provision is im- bailout fund. Another 1.35
continue to slow growth. 6.1% next year. The goal of The four-day meeting nev- portant because it will trillion euros is being printed
Germany, which had long the spending is to support ertheless put the bloc's give countries like Italy and by the European Central
resisted shared borrow- that upswing. deep-seated fault lines on Spain money they can Bank and injected into the
ing, played a decisive role By turning to shared debt display. To overcome resis- spend without adding to economy through a series
by changing its approach and spending, the EU is tak- tance from five European their national debt piles. of bond purchases that
in the face of the crisis as ing a different approach countries led by the Neth- Both were hard hit by the hold down market borrow-
Merkel pressed for a deal. to solidarity than during erlands, they trimmed the virus outbreak and Italy in ing costs for businesses,
"With the biggest-ever ef- the 2010-2015 debt crisis amounts to be dispensed particular has a large debt governments and consum-
fort of cross-border solidari- that pushed Greece and as grants and increased burden that must be regu- ers. It's those bond purchas-
ty, the EU is sending a strong four other members of the the amount offered as larly rolled over with new es that have kept the virus
signal of internal cohesion," 19-country euro currency loans that have to be borrowing. A huge spike crisis from turning into a fi-
said Holger Schmieding, union into international paid back. The money will in debt could deter bond nancial crisis while EU lead-
chief economist at Beren- bailouts. Greece was res- not kick in until next year markets from lending at af- ers debated.q
Ukraine hostage-taker surrenders, bus passengers unharmed

LUTSK, Ukraine (AP) — An Kyrylo Tymoshenko told re- and no one was hurt.
"unstable" armed man porters. Earlier, following negotia-
who seized more than a Shortly after the call, Zel- tions with the first deputy
dozen hostages on a long- enskiy posted a brief video chief of national police,
distance bus in Ukraine's message on his Facebook Yevhen Koval, the man
western city of Lutsk was page to urge Ukrainians to had released three of the
detained late Tuesday af- watch "Earthlings," a 2005 hostages, including a preg-
ter a standoff that lasted American documentary nant woman. At one point
for over 12 hours and all exposing humanity's cruel during the conversation,
hostages were freed un- exploitation of animals - he fired his gun through the
harmed, officials said. as the hostage-taker had bus window and a bullet
The assailant agreed to re- wanted. narrowly missed Koval, who
lease the hostages follow- Minutes later, the assailant also brought water for the
ing a 15-minute phone call walked out of the bus and hostages. After the drama An assailant, who seized a long-distance bus with 10 hostages,
with Ukrainian President surrendered to the police. ended, Zelenskiy hailed law lies on the ground after police officers captured him in the city
Volodymyr Zelenskiy, Zelen- Authorities said all 13 hos- enforcement officers for centre of Lutsk, some 400 kilometers (250 miles) west of Kyiv,
skiy's deputy chief of staff tages he held were freed saving the hostages. q Ukraine on Tuesday July 21, 2020.
Associated Press