European Union leaders gather via videoconference on Friday to discuss in detail a bloc-wide plan to help countries through the economic fallout from the COVID-19 pandemic — likely to send the EU into its worst ever recession — but splits between states remain and the meeting is expected to be at best a “stepping stone” towards an eventual deal.

A 750-billion-euro post-COVID19 recovery plan proposed in May, as well as the latest Multiannual Financial Framework, the EU’s seven-year budget, will be discussed at leadership level for the first time, European Council President Charles Michel said in a statement ahead of the meeting, adding that while he hoped to reach consensus as soon as possible a deal was not imminent.

“There is still quite some way to go towards an agreement, so we will need to work hard in the coming days and weeks,” Michel wrote in an invitation letter to EU leaders. “We will succeed if we enter talks with a sense of responsibility and the willingness to come out of this major challenge united and strong.”

The words of the former Belgian prime minister, who said the meeting should be regarded as “a crucial stepping stone towards an agreement at a subsequent physical meeting,” which could take place n July, indicate continuing discord within the 27-member bloc over the rescue package.

The current recovery plan, which is supported by powerhouse nations France and Germany, includes 500 billion euros in grants and a further 250 billion euros in conditions-based loans. The European Commission would borrow the money on the financial markets under the existing proposal, based on a 30-year term with repayments not beginning before 2028.

In his letter, Michel identified the “size and duration” of parts of the plan, the allocation of payments and conditionality as “elements that require further clarification or where views still need to converge.” 

Hard-hit southern countries such as Italy and Spain have previously said northern nations have not done enough to help in the fallout from the virus. There is ongoing disagreement over the form of payments, how long they should be made available for and in what proportion they should be distributed to individual members. 

In The Spotlight: Charles Michel

COVID-19 Bulletin: Croatia infection spike

The formula currently on the table takes into account population, per capita GDP and unemployment, but some members argue that data doesn’t reflect the current situation.

There has also been disquiet from the Netherlands, Denmark, Austria and Sweden, whose leaders called, in a letter published in the Financial Times on Tuesday, for a “realistic level of spending” and for all the money to paid in the form of loans. 

The leaders backed the creation of a time-limited recovery fund to help the hardest-hit countries but questioned how it can “suddenly be responsible to spend €500bn in borrowed money and to send the bill into the future?”

The Financial Times added that Baltic countries and eastern states could voice criticism at parts of the recovery fund during the video conference.

German Chancellor Angela Merkel on Thursday called for member states to show “solidarity” with countries hit hard by COVID-19 and agree a deal soon, while acknowledging that the “starting position is anything but easy.”

“The pandemic shows us how vulnerable Europe is,” she told the Bundestag. “Therefore I want to stress to you that cohesion and solidarity in Europe were never as important as they are today.” 

Germany will assume the rotating presidency of the Council of the European Union for six months on July 1 and could be pivotal in pushing through any deal. 

Friday’s meeting is also expected to feature a briefing from Michel and European Commission President Ursula von der Leyen on their talks with British Prime Minister Boris Johnson over the post-Brexit EU-UK relationship, and an overview of the economic situation from European Central Bank President Christine Lagarde.