Coronavirus could lead to breakup of Eurozone, EuroGroup head Centeno warns

The Portuguese Finance Minister sent a letter to the EZ Ministers

The Finance Minister of Portugal and EuroGroup President Mario Centeno warned the 19 Eurozone Finance Ministers in letter that the impact of the coronavirus pandemic could result in the the Eurozone.

According to the French News Agency, which became aware of the letter on Tuesday, Centeno underlined: “We will inevitably come out of the crisis with a much higher level of debt”, adding “However, this effect and its lasting effects should not be a cause for fragmentation.”

In his letter, Centeno asked ministers to come up with proposals to deal with the risk of debt overhang, in a sign that the debate over issues such as joint debt issuance via so-called coronabonds would be on the table at their next discussion

“We should explore ways to put existing instruments to use, but should be open to consider alternatives, where the former turn out to be inadequate,” wrote Centeno.