A President of the European Commission, Ursula von der Leyen, travels to Lisbon next Wednesday, with the aim of formally announcing the approval of the Portuguese Recovery and Resilience Plan (PRR), which is still subject to approval by the college.
After Von der Leyen itself announced last Tuesday that the Commission would “start approving plans for the Council’s adoption as early as next week”, the community executive announced that the president will travel to five states. -members between June 16th and 18th, to announce the results of the first evaluations that Brussels is preparing to complete, thus ‘anticipating’ the first five countries that will see their RRP approved: Portugal and Spain (16 June), Greece and Denmark (17th) and Luxembourg (18).
Community executive spokeswoman Dana Spinant stressed that the announcement of approval of the first plans for Member States to access the funds of the ‘NextGenerationEU’ recovery package is still subject to approval by the College of Commissioners, and although it declined to go into details about the precise timing of this process, which should take place at the weekly meeting scheduled for Tuesday, June 15th.
What does the Portuguese PRR foresee?
Portugal, which was the first Member State to formally deliver in Brussels, in April, the respective Recovery and Resilience Plan – which foresees €16.6 billion projects, of which €13.9 billion are non-refundable grants. – hopes that the adoption of the first plans by the Council will be possible during its presidency, which ends at the end of this month of June.
The Executive has open the possibility of resorting to an additional 2,300 million euros in loans.
According to the Government, the PRR was organized in 20 components which, in turn, comprise a total of 37 reforms and 83 investments. You can consult the document here.
The components of the PRR and the associated investments© Recovery and Resilience Plan
European Commission prepares trip to the markets
On June 1, and once the process of ratifying the own resources decision by the 27 Member States was completed – which was an indispensable condition for Brussels to go to the markets to issue debt to finance the recovery package -, the Commission announced that it would issue around €80 billion in long-term bonds., the first operation to raise funding to support European post-pandemic economic recovery.
To finance the recovery, the European Commission will, on behalf of the EU, take out loans in capital markets up to €750 billion at 2018 prices – or up to around €800 billion at current prices – which translates into loans of around €150 billion a year, on average, between mid 2021 and 2026, making the EU one of the main outbound markets.
The funds will finance the €672.5 billion Recovery and Resilience Facility (at 2018 prices) and a core element of the ‘Next Generation EU’, the €750 billion fund approved by European leaders in July 2020 for the EU’s economic recovery from the crisis caused by the covid-19 pandemic.
The pre-financing of 13% of the total amount allocated to each Member State will be made available to national governments after approval of their plans by the Council of EU Finance Ministers (Ecofin), with the next one taking place at next Friday, June 18th.
The Portuguese presidency has already acknowledged its readiness to organize an extraordinary Ecofin at the end of June, if necessary for the adoption of the first package of plans.
Also read: Covid-19: Germany lifts traveler warnings on July 1
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