Finance
Spain Calls for Joint EU Debt Issuance to Cut Costs
Published by Global Banking & Finance Review®
Posted on April 16, 2026
2 min readLast updated: April 16, 2026
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Spanish Finance Minister Carlos Cuerpo proposed on April 16 in Washington that the EU issue more joint debt—potentially one‑third of annual redemptions—to create a 5 trillion‑euro “safe asset” within five years, yielding around €25 billion in annual savings.
Spain Urges Joint EU Debt Issuance to Reduce Costs and Boost Investment
Spanish Finance Minister Advocates for Joint EU Debt
Call for Increased Joint Debt Issuance
WASHINGTON, April 16 (Reuters) - Spanish Finance Minister Carlos Cuerpo called on Thursday for more joint EU debt issuance, arguing the lower cost of borrowing that would follow would save taxpayers' money and help finance the much-needed investment.
EU's Readiness for Joint Debt
Speaking at the Peterson Institute for International Economics in Washington, Cuerpo said the European Union already had almost all the ingredients necessary to issue joint debt - a safe asset - because it was a key player in international trade, had strong institutions and a resilient market infrastructure.
Proposed Structure for Joint Debt
"The European Commission could issue on behalf of EU member states a specific share, a certain amount. For example, we could be thinking of about one-third of yearly redemptions and also the specific deficit that is allowed by European fiscal goals," Cuerpo said on the sidelines of the International Monetary Fund and World Bank spring meetings in Washington.
Potential Market Impact and Savings
"If we just look at these two elements, that would mean, in five years time, (we) would have a 5 trillion euro-denominated market issued by the European Commission, which would imply 25 billion euros in savings on an annual basis," Cuerpo said.
Opposition and Compensation Mechanisms
Resistance from Northern European Countries
Germany and some other northern European countries have been strongly opposed to joint EU debt, not willing to share the responsibility for the debts of others.
Compensation for AAA-Rated Countries
The savings would come from the fact that the Commission's borrowing is cheaper, because its debt is AAA-rated. Cuerpo said under the Spanish proposal, there would be some compensation mechanism for EU countries that already have AAA (ratings) and can borrow equally cheaply or cheaper - Germany, Denmark, Luxembourg, Netherlands, and Sweden.
Comparison with U.S. Treasury and Future Outlook
Current and Projected Debt Issuance
He said joint debt issuance by the Commission now was 750 billion euros, while U.S. Treasury issuance was $40 trillion, but the 5 trillion euros of EU safe assets in five years would be a good start.
Need for a Safe Asset
"This is a step that we need to take. We need an anchor, we need a safe asset," he said.
(Reporting by Jan Strupczewski; Editing by Paul Simao)
Key Takeaways
- •The EU already issues joint debt—e.g. €750 billion via Next Generation EU and other schemes—and further issuance could significantly deepen the EU’s safe‑asset market (lemonde.fr).
- •Economic experts (e.g. Blanchard & Ubide) have proposed joint debt equal to up to 25% of GDP to strengthen EU capital markets, lower borrowing costs and enhance the euro’s international role (english.elpais.com).
- •Mechanisms like the SAFE programme and leveraging the ESM’s capital are gaining traction, though political resistance—especially from fiscally conservative Northern states—remains a key obstacle (esm.europa.eu)
References
Frequently Asked Questions about Spain calls for joint EU debt issuance to cut costs
1Why is Spain calling for more joint EU debt issuance?
Spain believes joint EU debt issuance would lower borrowing costs, save taxpayers money, and help finance necessary investment across the EU.
2What benefits does the Spanish Finance Minister cite for joint EU debt?
Carlos Cuerpo highlights lower borrowing costs due to the EU's AAA rating, potential taxpayer savings, and better investment funding.
3Which countries oppose joint EU debt issuance?
Germany, Denmark, Luxembourg, Netherlands, and Sweden have resisted joint EU debt due to concerns about sharing debt responsibilities.
4How much EU joint debt does the Spanish proposal suggest over five years?
The Spanish proposal envisions issuing 5 trillion euros in EU safe assets over five years, resulting in significant savings.
5What compensation is proposed for AAA-rated EU countries?
The proposal includes a compensation mechanism for AAA-rated countries that can already borrow at low or equal rates.
