An economic crisis threatens due to the corona pandemic. EU member states struggle over a collective strategy for handling the economic fallouts. A joint fiscal response by eurozone member states could calm the markets, prevent sovereign debt crises and nip doubts about the integrity of the eurozone in the bud.

Julian Pröbstl, research assistant at the MPI for Tax Law and Public Finance argues that resorting to the ESM credit line is to be preferred to issuing coronabonds because the former is legally more certain and can be implemented faster. His article has been published in German on Verfassungsblog.de and in English on VoxEU.org, the policy portal of the Centre for Economic Policy Research (CEPR), as well as on Regulation-Y, a portal on financial regulation.

If you read German:

https://verfassungsblog.de/esm-kredite-statt-corona-bonds/

If you read English:

https://voxeu.org/article/legal-perspective-esm-loans-and-coronabonds

https://regulation-y.com/2020/04/04/esm-loans-or-corona-bonds-a-legal-analysis-from-the-german-perspective/

The opinions expressed in this contributions are the authors' alone.

March 2020