Italy rejects Dutch veto demand over EU recovery fund distribution

Italy rejects Dutch veto demand over EU recovery fund distribution

Dutch demands for a veto by individual member states over how the European Union allocates its planned 750 billion euro recovery fund is "a red line" for Italy, economy minister Roberto Gualtieri said on Friday.

"Some countries want a single country to be able to block the distribution of funds: for us this is a red line," Gualtieri told Italian TV channel La 7's news bulletin.

Another of Italy's "red lines" is that the proposed recovery fund is able to meet the challenge European economies face in rebuilding their COVID-19 shattered economies, Gualtieri said.

"It is not a matter of transfers from one country to another but rather the EU funding its shared expenses," he underlined.

At a fraught EU leaders summit that kicked off on Friday, heads of state and government are trying to agree how to carve up the bloc’s 2021-27 budget, proposed at 1.07 trillion euros, and the linked 750 billion COVID-19 recovery fund.

Dutch premier Mark Rutte is leading a "frugal" group of northern, wealthy countries that want a smaller total package and loans rather than grants for the debt-ridden south.

The "frugal" countries want economic reforms as a condition for getting funds, a more extensive vetting process for aid and to keep rebates for richer states that are net payers to the EU budget.

Coronavirus-ravaged Italy stands to be the biggest beneficiary of the EU's proposed recovery fund, followed by Spain and Frances.