The European Commission is promoting a financing plan to accelerate Europe’s economic recovery through the creation of an extraordinary funding programme and a reinforced long-term European budget.
With the aim of accelerating the economic recovery of the European Union (EU), the European Commission (EC) presented on May 26th a dual response to slow the progress of the crisis and try to address the emerging needs of Member States. Through the creation of the extraordinary plan ‘Next Generation EU’ endowed with 750,000 million Euros, which will allocate to the EU budget new funding obtained in the financial markets during the period 2021-2024; and a long-term European budget reinforced for the period 2021-2027 with 1.1 trillion Euros.
Enhancing recovery and resilience
With the aim of offering a coordinated and common response from the EU to the crisis of Covid-19, the funds ‘Next Generation EU’ will be allocated to those areas in which they can influence, complement and improve the work currently being developed by each Member State, based on three pillars:
- Supporting Member States to recover, repair and emerge stronger from the crisis. Through this pillar, the EC seeks to boost and improve the response of each European State, so that they reduce as much as possible the incidence of Covid-19 in their nations and that they can continue to face the climate challenges. To this end, three strategies have been promoted:
- European Recovery and Resilience Facility, embedded in the European Semester based on its annual strategy for sustainable growth 2021 which reaffirms the measures promoted by the European Green Deal and competitive sustainability. To this end, the EC aims to encourage States to include investments and reforms in ecological and digital matters to create sustainable jobs and growth.
- REACT-UE: A plan to support the recovery of cohesion and European territories.
- Supporting the green transition to a climate-neutral economy: Through the extraordinary funds ‘Next Generation EU’ is intended to accelerate the transition of Member States to climate neutrality and strengthen the European Agricultural Fund for Rural Development in order to adapt to the new requirements of the European Green Deal.
- Kick-starting the economy and helping private investment. Through the provision of European budgetary guarantees to boost both national and Community financial markets.
- Learning from the crisis and tackling Europe’s strategic challenges. The aim is to prepare States for future crises and to give them autonomy in their response.
Reinforcing European programs
The EC also seeks to strengthen other programs that help build the Union’s resilience and address the challenges posed by the pandemic and its consequences.
These are, among others, Horizon Europe, the Neighbourhood, Development and International Cooperation Instrument (NDICI), Humanitarian Aid Instrument, Digital Europe Programme, Connecting Europe Facility, Common Agricultural Policy, Instrument for Pre-Accession Assistance (IPA), etc.