EU leaders agree to mobilise €1 trillion as Covid-19 rescue plan

European Union leaders have agreed upon a plan for injecting billions of euros of emergency aid into Europe's battered economies.

European Commission chief Ursula von der Leyen said the fund would mobilise €1 trillion of investment.

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The various heads of the bloc held a meeting through video conferencing during which they agreed to set up a massive recovery fund, closely tied to it's seven-year budget.

They also confirmed that €540bn of financial support would be released through existing mechanisms from 1 June.

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Previously, a bitter argument had taken place regarding how to fund the much-needed aid.

Italy, which has hit the hardest by the outbreak in Europe, had urged its EU partners to show more solidarity.

However, after the relief fund got passed it's Prime Minister Giuseppe Conte said "great progress" had been made.

Leaders also agreed to follow guidance from the EU Commission, the organisation's executive arm, on easing their respective lockdowns once the spread of the virus had reduced for a "significant period".

Details of how the longer term recovery plan will be funded will be discussed at another videoconference on May 6.