European Union needs perpetual debt to survive – George Soros
Objections by Poland and Hungary over an EU plan to deal with the economic crisis has put the bloc in a “very difficult situation” and raises doubts over its future, according to billionaire investor George Soros.
Soros had previously said the EU should issue “perpetual bonds,” which means the principal amount of the money borrowed would never be repaid, only the annual interest payments. It also assumes the EU would last forever and therefore keep paying the interest back to the lender. Perpetual bonds could allow the region to fund projects at very low costs.
However, Soros has changed his mind, writing in an opinion article that “Right now, it would be impossible for the EU to issue perpetual bonds, because the member states are too divided.”
He explained that “Investors will buy perpetual bonds only from an entity that they believe will continue to exist for the foreseeable future… Sadly, it is not true of the EU today.”
Last month, the Hungarian and Polish governments vetoed EU’s plan to link access to the union’s funding to the application by member states of rule of law, a check on whether countries are complying with European values.
https://www.rt.com/business/508353-eu-survival-doubts-soros/