Perpetual bonds are the answer to the EU’s Covid-19 woes

The union should look to history for a solution to the economic catastrophe and existential crisis it is now facing

20th April, 2020
Perpetual bonds are the answer to the EU’s Covid-19 woes
European Commission President Ursula von der Leyen during a visit to Dublin in January. She has said the EU will need about €1 trillion to fight the Covid-19 pandemic. Picture: PA

Ursula von der Leyen, the European Commission president, has announced that Europe will need about €1 trillion to fight the Covid-19 pandemic. This money could be used to establish a European recovery fund. But where will it come from?

I propose that the EU should raise the money by selling perpetual bonds, on which the principal does not have to be repaid (although they can be repurchased or redeemed at the issuer’s discretion). Authorising this...

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