EU leaders have struck a deal on a huge post-coronavirus recovery package following a fourth night of talks.
It involves €750bn in grants and loans to counter the impact of the pandemic in the 27-member bloc.
The talks saw a split between nations hardest hit by the virus and so-called “frugal” members concerned about costs.
The deal centres on a €390bn programme of grants to member states hardest hit by the pandemic. Italy and Spain are expected to be the main recipients.
A further €360bn in low-interest loans will be available to members of the bloc.
The package will allow members to maintain spending in the aftermath of lockdowns that badly affected public finances.
It includes checks that the funds will not be misused. Recipients will have to submit spending plans to the European Commission, and a majority of states will be able to block projects.
The package will now face technical negotiations by members, and needs ratification by the European Parliament.
The leaders reached agreement early on Tuesday after more than 90 hours of talks.
Mr Michel, the president of the European Council, called it “the right deal for Europe right now”.
Tempers were often frayed during the negotiations. The “frugal four”, Sweden, Denmark, Austria and the Netherlands, along with Finland had opposed extending €500bn in grants.
The group originally set €375bn as the limit. Other members, such as Spain and Italy, did not want to go below €400bn.
At one point French President Emmanuel Macron reportedly banged his fists on the table, as he told the “frugal four” they were putting the European project in danger.
The €390bn figure was suggested as a compromise, and “frugal” nations were reportedly won over by the promise of rebates on their EU budget contributions.
Another issue was over linking aid to the “rule of law”. Hungary and Poland both threatened to veto the package if it adopted a policy of withholding funds from nations deemed to fall short of democratic principles.
President Macron said it was a “historic day for Europe”.
Mr Michel said: “We showed collective responsibility and solidarity and we show also our belief in our common future.”
European Commission President Ursula von der Leyen tweeted. “Today we’ve taken a historic step, we all can be proud of. But other important steps remain. First and most important: to gain the support of the European Parliament.”
Dutch Prime Minister Mark Rutte, who led the “frugal group”, welcomed the agreement, but acknowledged the fractious nature of the talks. “We are all professionals, we can take a few punches,” he told reporters.