'TIME IS OF THE ESSENCE'
Euro zone finance ministers had suggested that governments use a precautionary credit line (ECCL) from the bailout fund worth up to 2% of GDP to fight the crisis, a move that would also pave the way for unlimited European Central Bank bond purchases if needed.
Leaders did not reject that suggestion last week, but did not clearly endorse it either.
Regling said that, to cover common short-term financing needs stemming from the outbreak, "I think the only way is to use existing institutions with existing instruments."
The euro zone's finance ministers are due to discuss the matter again on Apr.7. Luxembourg's Pierre Gramegna expressed support for Regling's proposal on Tuesday.
"COVID-19 warrants a common EU response," he tweeted. "The EU Commission and EIB together with ECB have the tools to quickly implement the ESM proposals. Time is of the essence to overcome this crisis."
ECB head Christine Lagarde; European Commission President Ursula von der Leyen; Charles Michel, the chairman of EU leaders; and Mario Centeno, president of the eurogroup of euro zone finance ministers, are due to discuss the matter further at 1300 GMT on Tuesday.
To secure an ECCL, a country has to submit to a European Commission analysis of whether its debt is sustainable, something that heavily indebted Italy is reluctant to do.
However, Regling said that, given the circumstances, conditions attached to such a credit line could be minimal. "There should also be a commitment to respect EU surveillance frameworks ... it would be no more than that," he said.
