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Headlines

Germany, Netherlands, Sweden oppose EU common borrowing

Published by Global Banking and Finance Review

Posted on July 18, 2025

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By Philip Blenkinsop and Maria Martinez

DURBAN, South Africa (Reuters) -Germany, the Netherlands and Sweden oppose European Union joint borrowing despite mounting global challenges, while Denmark is sceptical, finance ministers from those countries said on the sidelines of a G20 meeting in Durban, South Africa.

Dutch Finance Minister Eelco Heinen said that a 2 trillion euro ($2.31 trillion) EU budget for 2028 to 2034 proposed on Wednesday by the European Commission was way too large and was "dead on arrival".

"I'm not in favour of joint borrowing. The Netherlands has never been and will continue on that path," he told Reuters.

Some members of the 27-country bloc argue that joint debt could help fund the massive EU-wide spending plans that the Commission is seeking, allowing cheap borrowing.

Common borrowing was first used by the EU to help countries pay for the recovery from the coronavirus pandemic. But then, as now, countries such as the Netherlands, Germany and the Nordics resented having to pay for poorer southern countries that they see as lacking fiscal discipline.

Swedish Finance Minister Elisabeth Svantesson said the joint debt to deal with the pandemic was exceptional.

"For us and for the whole parliament, from left to right, it was that we did that once. And that was not to be repeated," she told Reuters.

Danish Minister of Economic Affairs Stephanie Lose said joint borrowing was sometimes presented as being the answer to all problems, but that it was important to remember the money would have to be repaid.

German Finance Minister Lars Klingbeil told Reuters on Thursday that the EU had joint debt in what was a crisis situation but this was not appropriate for resolving the bloc's finances.

"Fortunately, we are not in such a crisis right now," he said.

The 27 nations agreed in 2020 to jointly borrow 800 billion euros for the Next Generation EU programme, the bloc's pandemic recovery plan.

Heinen agreed that fund was a one-off, adding, "never again".

"When that fund was being set up, the Netherlands already said, be careful, because one day that bill will be presented, and that's the moment we're in right now."

($1 = 0.8589 euros)

(Reporting by Maria Martinez and Philip BlenkinsopEditing by Frances Kerry)