The European Union has set up a fund in order to compensate countries for damages
resulting from Covid-19 that hit the economies in an asymmetric way. We argue
that payments should be based only on relative damages, expressed as losses relative
to GDP, and any distribution mechanism implying that damages in the countries
are treated differently is discriminatory. Hence, we compute the compensation payments
if the resources of the fund are spent according to the relative loss in GDP.
Finally, we compare the compensations relative to the losses in GDP, resulting from
the application of that principle, with those obtained by distributing the funds as
suggested by the Council of the European Union. Our results provide evidence of
discrimination by the EU Covid-19 compensation package.