Europe Seeks to Boost Pandemic-Damaged Economy by Spending

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Europe Seeks to Boost Pandemic-Damaged Economy by Spending

Europe hopes to spur an economic recovery from the pandemic by boosting government spending, a shift in strategy from the 2008 financial crisis that economists say could lift the global economy.

Two events in the coming week are set to underscore the change.

First, European Union leaders on Thursday will begin a series of virtual meetings aimed at gaining final approval of a €750 billion fund, the equivalent of $912 billion, borrowed by the bloc as a whole to aid countries hit hardest by the pandemic’s effects.

The European Central Bank the same day will almost certainly announce an expansion of its bond-purchasing program, with the explicit aim of keeping down borrowing costs for governments, thereby enabling them to spend more freely.

That combination is intended to place government spending at the heart of efforts to stimulate Europe’s economy in 2021 and beyond.

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