In the Netherlands, the president of the central bank delivers an unexpected pro-European plea

Central banker Klaas Knot defends a vision at odds with Dutch Prime Minister Mark Rutte, one of the leaders of “frugal” European states.

A permanent stimulus fund for European states in difficulty and the cancellation of part of their debt, to allow them to reinvest: during a conference in The Hague, Tuesday 1 st September, the governor of the National Bank from the Netherlands (DNB), Klaas Knot, surprised and created a stir. Because he was defending a point of view in contradiction with the extremely firm position defended in July, in Brussels, by Prime Minister Mark Rutte.

With his “frugal” allies, the liberal leader had to the time forced his European colleagues to negotiate for ninety hours, accepting only with difficulty, in the end, the principle of a common debt of 750 billion. In exchange for a series of conditions, including an increase in the rebate enjoyed by his country for its contribution to the European budget, which will also fall short of the hopes of the Commission and Parliament. To show his prudence – even his mistrust – the head of the Dutch government had refused to speak of a “historic” agreement, a formula used in particular by Emmanuel Macron and Angela Merkel.

A “restructuring”, even debt forgiveness

Mr. Knot, on the other hand, considers it necessary to go beyond the July decisions. Stressing all the same that it is only about a “option” and that it is “complex” , it evokes a “restructuring” , or even a write-off, of the debt of the most indebted countries, including Greece and Italy. “The option is theoretical, but it is undoubtedly the best” , affirms the leader of the DNB.

However, he mentions certain conditions: an analysis “depoliticized” of the problem first, the establishment of a “firewall” to avoid contagion to other countries and the implementation of strict reforms. Even cautious, the words will make react a country which, notes the daily De Volkskrant , readily yields to “hysteria” when one speaks to it about debt.

Other remarks by the leader will provoke lively debates: he pleads for agreements at European level on corporate tax while his country has stepped up initiatives to attract multinationals by promising them a more than favorable tax status. “The race for lower taxes is not a reasonable step” , he notes. Mr Knot also said his country, regularly invited by Brussels to limit its trade surplus, should spend more to stimulate growth, in the Netherlands and elsewhere in Europe.

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