Germany says proposed recovery fund is not about joint borrowing

A Franco-German proposal for a half-trillion euro fund to support European Union countries worst hit by the coronavirus pandemic is not about joint borrowing or joint bonds, a German government spokesman said on Wednesday.

The bloc's budget rules would still apply, Chancellor Angela Merkel's spokesman Steffen Seibert said at a regular news conference. "There is also a binding repayment plan."

"It is distinctly different from joint borrowing," Seibert said, adding the proposal does not mean there would be joint bonds in disguise.