In an interview with Italian daily newspaper Corriere della Sera, chief executive of the European Financial Stability Facility Klaus Regling said the money will go towards the economic recovery, rather than immediate responses to the virus such as healthcare spending.
“We are now in the first phase of the crisis, but we know that there will be a very important second phase – that of recovery, which will be long and expensive,” said Regling.
“By then we will need significant amounts of money and we must start to see how the various institutions can contribute: what the European Investment Bank can do, what the Commission can do with the European budget.”
The IMF has estimated the euro area will see a 7.5% recession because of the pandemic, although it warned it could be even worse.
In the past few weeks, euro area finance ministers have agreed a €540bn rescue package for their economies, and Regling said the euro economies will need about the same amount again.
“I would say that for the second phase we need at least another 500 billion from the European institutions, but it could be more,” said Regling.
“This is why we must discuss new tools with an open mind, but also use existing institutions, because it is always easier - including above all the Commission and the EU budget.”
