France's Macron Warns Of EU Collapse Without Financial Cooperation

In a Financial Times interview, French President Emmanuel Macron has warned the European Union could collapse unless it embraces financial solidarity.  .

Macron questioned China's handling of the coronavirus outbreak in the interview. The French president said it was "naive" to suggest China had dealt better with the crisis.

The U.S., U.K, France, Italy and Spain are amongst the worst-affected countries in the pandemic. 

The EU's economic approach during the crisis will determine whether it is "a political project or a market project only," Macron said. 

EVIA's Clark Says EU Unraveling 'Highly Unlikely' 

Macron's comments reflect a differing approach to European financial and budget management rather than the political unity that led to the EU in the first place, David Clark, chairman at the European Venues and Intermediaries Association, said in a note. 

In March, there were reports that European Central Bank President Christine Lagarde asked eurozone finance ministers to consider a one-off joint debt issuance of “coronabonds” to assist with the coronavirus pandemic. But this has been met with opposition by the Netherlands and a number of other EU states.

“It is clear that the countries that make up the EU, and especially the eurozone, do not all have the same creditworthiness, but this is also true of the U.S.," Clark said. 

Clark said it is right to assert that there should be federal capital-raising capacity, but a path needs to be found for both state and EU funding to operate alongside each other in markets under strict budgetary rules.

"In the highly unlikely event that the EU unravels, the first step regardless would be the reintroduction of legacy currencies, and this would be more disruptive than any of the present issues."

Related Link: Lagarde Asks European Countries To Support 'Coronabonds'