WEB DESK
The European Commission has sanctioned a €750 billion aid package to help the EU recover from the coronavirus pandemic. The plan will require unanimous backing from all 27 nations in the bloc.
The European Commission on Wednesday proposed a €750 billion ($821 billion) aid package to help Europe’s economic recovery from the fallout of the coronavirus pandemic, which has killed over 350,000 people globally.
In a statement on its website, the EU governing body proposed the creation of a new recovery instrument, dubbed Next Generation EU, to address the economic damage caused by the outbreak.
“Next Generation EU (consists) of €750 billion as well as targeted reinforcements to the long-term EU budget for 2021-2027 (and) will bring the total financial firepower of the EU budget to €1.85 trillion,” the statement said.
The recovery fund would be embedded within the next long-term EU budget.
“The recovery plan turns the immense challenge we face into an opportunity, not only by supporting the recovery but also by investing in our future: the European Green Deal and digitalization will boost jobs and growth, the resilience of our societies and the health of our environment,” European Commission President Ursula von der Leyen said in the statement.
Ursula von der Leyen: ‘This is an urgent and exceptional necessity, for an urgent and exceptional crisis’
“This is Europe’s moment. Our willingness to act must live up to the challenges we are all facing. With Next Generation EU we are providing an ambitious answer.”
The plan comes as the 27-member bloc faces the prospect of a deep EU-wide recession. Nearly all member states have breached EU deficit limits as they have rushed to spend on supporting healthcare systems, businesses, and jobs.
In the proposed plan, the EU will borrow €750 billion for the recovery fund on the financial markets, which would be repaid through future EU budgets.
The fund will include a new “Recovery and Resilience Facility” totaling €560 billion that will offer financial support for investment and reforms. The instrument will be made up of €310 billion in grants and €250 billion in loans.
EU member states have been divided on whether loans or non-repayable grants are the best approach for funding the bloc’s recovery.
The Commission also proposed an amendment to its current financial framework for 2014-2020 to make €11.5 billion in funding available this year.