(Bloomberg) —

European Central Bank President Christine Lagarde told the region’s leaders that the euro-area economy could shrink by as much as 15% as a result of the pandemic, and that they risk doing too little, too late, according to three people familiar with the remarks.

Lagarde spoke during a video conference meeting of the European Union’s 27 heads of government, who are discussing how to mitigate the economic fallout of the virus.

One of the officials, who asked not to be identified because the deliberations are private, said that a 15% recession is the extreme scenario singled out by Lagarde, with the ECB president saying her baseline estimate is a 9% cut in output this year.

With more than 100,000 fatalities in the region, Europe has been hard hit by Covid-19 and the fallout from the crisis is tearing at the fabric that holds the group of nations together. Strict lockdowns have shuttered factories and halted travel, pitching the trading bloc into the worst recession in living memory.

The European Commission, the bloc’s executive arm, has floated a 2 trillion-euro ($2.2 trillion) plan for economic recovery that would rely heavily on the EU’s budget, according to a draft copy of the proposal obtained by Bloomberg.

That plan would include the commission borrowing 320 billion euros on the capital markets and then channeling the proceeds to member states hit the worst.

Economic data on Thursday illustrated how the recession is turning out worse than many early predictions. Measures of private-sector business activity plunged more than expected to an all-time low, and signaled record job cuts. Corporate and consumer confidence slumped in the bloc’s biggest economies.

So far most fiscal action has been by national governments, raising fears among investors that an uneven response will tip the currency area into another financial crisis later on.

France, Spain and Italy have called for the EU to introduce joint debt sales but governments such as Germany and the Netherlands have rejected so-called coronabonds over fear that they’d be stuck with the bill. There is also disagreement over who how to share the costs of the recovery, and under what terms the pooled funds would be disbursed.

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The ECB has led the European-level response, pouring liquidity into the financial system and taking steps to ensure the cash can reach deep into the euro zone.

It has pledged to buy more than 1 trillion euros of debt over the rest of this year, and removed most of its self-imposed limits to allow it to target areas of market such stress such as Italian bonds. It has ramped up programs making it easier for banks to lend to virus-hit companies, including accepting some junk-rated debt as collateral.

The call continues.

(Updates with economic data from seventh paragraph)

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