Netherlands wants loans for EU recovery, Germany favours grants

The Netherlands insists that the planned European Recovery Fund should hand out financial aid for virus-hit member states only in the form of loans that would have to be paid back, Dutch Prime Minister Mark Rutte said on Tuesday.

"We need an emergency recovery fund to stimulate the recovery. We believe this should consist of loans, without any mutualization of debts," Rutte told reporters during a joint video conference with Armin Laschet, state premier of Germany's most populous state North Rhine-Westphalia.

Laschet said he supported a proposal put forward by German Chancellor Angela Merkel and French President Emmanuel Macron for the fund to hand out grants to European countries affected the most by the coronavirus pandemic.