Left just in time! Brussels to borrow eye-watering €80BN to plug bailout fund black hole

Orban ‘open to new proposals’ over EU budget says expert

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This large sum will also be topped up by billions of euros worth of EU bills in order to cover the final financial requirements to fund the bloc’s massive recovery plan. A Commission statement read: “The Commission will be able to fund, over the second half of the year, all planned grants and loans to member states under the Recovery and Resilience Facility, as well as cover the needs of the EU policies that receive NextGenerationEU funding.”

Coupled with the EU’s multi-year budget plan, the bloc is expected to use a colossal €1.8trillion (£1.5trillion) to aid its recovery.

Of the €1.8trillion, the EU’s coronavirus recovery fund accounts for €672.5billion (£580billion) of which €360billion (£311billion) are grants.

Some states such as the Netherlands and Austria had called for the package to be made up of loans rather than one-off grants to states such as Italy and Spain.

In order to access the money, each state must issue a plan to the Commission on how it will reform and invest in making the economy more green while boosting its resilience to a future crisis.

So far, 22 of the 27 governments have sent their plans for approval by other member states and the Commission.

It is expected the money will begin to be released next month while the Commission has claimed it will borrow €150billion (£129billion) a year between 2021 to 2026.

On Monday, the EU announced the approval of the scheme and will therefore be able to borrow money from capital markets.

EU Council President, Antonio Costa revealed the announcement and insisted the bloc cannot waste time in beginning its economic recovery.

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He said: “The European Union is now able to obtain the necessary funding for the European social and economic recovery.

“The governments and national parliaments of the EU 27 have shown a strong sense of solidarity and responsibility.

“We cannot afford to waste more time.

“We must ensure the swift approval of the first recovery and resilience plans by the end of June.”

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Johannes Hahn, Commissioner in charge of Budget and Administration, said: “Today, we are making yet another step forward in the preparations for the first borrowing operation to finance our collective recovery via NextGenerationEU.

“By issuing some €80 billion of long-term bonds and using additional short-term bills this year, we will manage to cover Member States’ most urgent needs and set them on the path towards a sustainable recovery and a green, digital and resilient Europe.”

The EU had come under heavy scrutiny for its slow vaccination plan which has only kicked into gear over the last few months.

Indeed, some EU states had looked outside of the bloc for vaccines due to the slow rollout plan.

With the bloc’s initially slow rollout now up to speed, officials now hope they can welcome essential British tourists to the bloc over the summer.

Speaking today, the EU’s ambassador to the UK, Joao Vale de Almeida expressed his hope for increased tourist travel to boost economies in the bloc.

He told the Today programme: “I hope many, many British citizens will come to our countries and I hope many EU citizens will visit the UK.

“We’re hopeful that sometime later in the summer, around July, we could be in a situation where travel and tourism will be made a lot easier.”

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