President criticises eurozone coronavirus recovery bailouts

The Finnish government has reacted warmly to a €500 billion proposal backed by EU Member State contributions, but Niinistö is strongly against the idea.

File picture of President Sauli Niinistö at Kultaranta press briefing, Helsinki 22nd May 2020 / Credit: Matti Porre, TPK

Finnish President Sauli Niinistö has used the launch of his Kultaranta summer discussion event to criticise the idea of bailing out eurozone countries during the coronavirus pandemic.

Speaking in Helsinki, Niinistö said that a return to the original principles of the eurozone, with no provision for bailouts, should now be up for discussion. The president said that would mean each member state is responsible for its own debts, even as he acknowledged countries would have to spend their way out of the economic damage caused by the coronavirus crisis.

Niinistö’s remarks come just days after Germany and France proposed a €500 billion temporary recovery fund, backed by the EU budget and Member States’ contributions, to help European economies recover from the impact of the crisis.

However it puts Niinistö at odds with the Finnish Government which has reacted positively to the proposals put forward by the French and Germans.

Although Finland previously took a stance against so-called ‘corona-bonds’ Minister for European Affairs Tytti Tuppurainen (SDP) said earlier this week that she welcomed the German and French initiative – and at least didn’t specifically say she was against this type of funding package.

“Finland’s position on Recovery Fund is open and constructive. We are ready to look at different options. We look forward to the Commission proposal on the matter. The focus of the fund is crucial. Recovery Fund should support EU’s digital recovery, Green Deal and research. Liabilities of each Member State must be completely clear” Tuppurainen wrote on Twitter.

Finnish opposition parties are strongly against any eurozone bonds. The leader of the National Coalition Party Petteri Orpo echoed President Niinistö (one of his predecessors as Kokoomus Chairman) in an interview, saying “everyone must take care of their own debts, otherwise the situation will lead to a moral hazard.”