It literally means “recovery fund” and is also called “Next Generation Eu”. It is Europe’s response to the emergency caused by the Covid-19 pandemic. Here is what you need to know about the recovery fund associated with the budget at long term of the European Union, from 2021 to 2027
It has been at the center of the debate for months and, now, it is the cardinal theme of the EU Council taking place on 17 and 18 July in Brussels: it is the Recovery Fund, or “Next Generation Eu”, that is, Europe’s response to the emergency caused by the Coronavirus pandemic. It consists of a recovery fund associated with the long-term budget of the European Union, from 2021 to 2027. And, precisely for this plan, on May 27th, the European Commission presented a € 750 billion proposal (CORONAVIRUS: GLI LIVE UPDATES, THE SPECIAL).
Means “recovery fund”
Recovery Fund, von der Leyen outlines the 750 billion European plan
The literal meaning of Recovery Fund is “recovery fund”. The financing of this fund to restart takes place through a collection of liquidity by Europe with the issue of particular “Recovery Bonds”. As the Italian Prime Minister, Giuseppe Conte himself defined it, it is therefore “a recovery fund with common European securities to finance the recovery of all the most affected countries, including Italy”. The plan announced on 27 May by the President of the European Commission Ursula von der Leyen spoke of 750 billion euros, 500 to be allocated directly to the Member States and 250 of loans.
To Italy the largest slice
Because the recovery fund represents the last call for Italy
According to an internal document from the Commission, Italy would have the largest share of this fund destined: around 172 billion, of which 81.8 billion are allocated to non-refundable funds and additional loans for 90.9 billion. Spain, which together with our country is in Europe among the most affected by the Coronavirus, should instead receive the second highest part: 140 billion euros (77 of grants and 63 of loans). Then Poland with 63.8 billion. Following France and Germany respectively 38.7 and 28.6 billion euros.
A difficult understanding
Recovery Fund, who are the “frugal countries” and what they ask for
The Coronavirus emergency has caused huge falls in GDP in many countries around the world. Europe in particular has found itself having to think of a measure capable of responding to this unprecedented emergency. However, a shared solution was not easy to find, given the internal contrasts. On the one hand, in fact, the alignment of the states that have a position of greater containment of the European budget, adverse to the hypotheses of sharing the debt, such as Denmark, Sweden, the Netherlands and Austria, that is the so-called Frugal Countries, has been formed. On the other hand, however, countries like Italy or Spain took sides, hard hit by the emergency.
An agreement still to be approved
Conte meets Macron in Brussels and attacks Rutte on the Recovery Fund
Thus, after the proposal by France and Germany to allocate money to the States affected by the pandemic and the opposition of the Frugal Countries favorable to loans, the European Commission project arrived in which both funding and concessions were funded lost. A hybrid solution therefore, which includes two quotas, but which has yet to receive the go-ahead from all 27 member countries.
The European Council of 17 and 18 July
Recovery Fund, Conte: “EU Council for the appointment with history”
Now the spotlight is on the European Council of 17 and 18 July, after which it will be clearer whether the Commission’s proposal will remain a proposal or finally find its approval. Only after an agreement is reached between all countries will it be possible to clarify in detail what the Recovery Fund will entail and what its definitive functioning will be. EU Commission President Ursula von der Leyen has already warned: “The whole world is watching us.”