Spain has proposed that the European Union issue up to €850 billion a year in joint debt, a plan it says could save member states billions in borrowing costs by tapping the bloc's superior credit rating.
Economy Minister Carlos Cuerpo will present the proposal to euro-area finance ministers on 10 July in Brussels. The plan envisions a European Sovereign Facility with voluntary participation and compliance with existing fiscal rules. Madrid estimates savings of around €5 billion annually at German-level borrowing costs, rising beyond €25 billion once the outstanding stock reaches €5 trillion. Should not all 27 member states join, Spain envisages a 'coalition of the willing' starting with the five largest issuers, enabling roughly €540–550 billion in annual issuance.
Guarantees would be backed by both loans to member states and the EU budget. Madrid intends the mechanism to take effect under the next seven-year budget beginning in 2028.