EU recovery fund

Spanish economy, Spanish Politics 10th March 2023

Spain has lowest absorption rate of EU funds (54%)

Scope Rating | Slow take-up of approved EU funds could also jeopardise future EU disbursements, as these will increasingly depend on governments’ ability to deliver on investment projects (mostly ‘targets’) rather than implement reforms (mostly ‘milestones’). Indeed, the low disbursement of EU funds received to date is common among some of the largest beneficiaries of EU recovery funds, such as Greece, Portugal, Spain and Croatia, given the energy crisis, rising…

Spanish economy 3rd March 2021

Spain Expects To Mobilize €500 Bn In Investment With European Funds

Miguel Navascués | In a paper entitled Recent Developments in the Spanish Economy, Policy & Funding, the Spanish government explains how the €140 Bn from the European Recovery Fund will be allocated to obtain the best result: a solid rebound of the economy with permanent fundamentals. According to the government, it is expected these €140 Bn to have a multiplier effect of about €500 Bn, i.e. a not inconsiderable multiplier of 3.6 euros for each spent. Is it reasonable to expect such an amount?

Spanish economy 18th January 2021

Spain Could Receive More European Funds In Direct Aid Than Initially Planned

The European Recovery Fund monopolized, along with the coronavirus pandemic, the 11th edition of Spain Investors Day, which closed last Thursday with the aim of positioning the country as an investment destination. At the same time, the EU was planning to increase direct aid to Spain by €11 billion, given the crisis’ impact on debt, as can be seen in one of the annexes to the regulations on the Facility for Recovery and Resilience, which is awaiting final ratification.

European politics 11th November 2020

Agreement To Unlock The EU Recovery Fund, But Conditions Remain Uncertain

After four months of negotiations, the Council and the European Parliament agreed yesterday the new 2021-2027 budgetary framework. Although the full breakdown is not known, the budget will mobilise more than 1.8 trillion euros during this period. In addition, both bodies agreed to unblock the Next Generation EU programme. The accord includes reinforcing with an extra €15 Bn the funding of key programmes such as EU4Health, which will triple its previous budget, Erasmus+ or Horizon Europe (R&D).

Current EU major challenges-Brexit and Italy budget- move but still remain stranded

Spanish economy 7th October 2020

The Spanish Budget For 2021: Priority, Indispensable, Inevitable

Although Spain’s budgetary credibility in Europe, built up over the past decades, is in tatters- none of the deficit or debt commitments of recent years have been met- the country needs a budget which can be presented in Brussels, in order to obtain the green light for European financial flows. These are essential. Therefore, Pedro Sánchez’ s government aspires to obtain a minimum political agreement for the approval of the 2021 Budget, without which it could not survive.

Spanish economy 5th October 2020

Spain Needs A “Clear Governance Structure” To Oversee The Use Of European Funds, Says IMF

According to the annual review of the Spanish economy, known as ‘Article IV’, the IMF believes the impact of the European funds will increase the GDP growth forecast for 2021 to 7.2%. This compares with the previous estimate of 6.3% made in June. The final forecasts will be made known in October, when the institution will publish its biannual ‘World Economic Outlook’.

European economy 22nd July 2020

A Lot of Light And Some Shadow In The First European Debt Mutualisation Device

For the first time in its history, the European Union will take on debt to finance an extraordinary economic stimulus composed of 390 billion euros in grants and 360 billion in loans.It has finally managed to put together a European instrument for sharing debt. Equally important, the plan sends a signal to markets that the EU remains united in response to existential threats. However, the price for achieving the agreement has been high: maintaining the rebate cheques, renouncing of strict control as far as respecting the rule of law mechanism in the management of EU funds, increased conditionality and the fact the fund cannot work completely without ECB’s support.

European politics 20th July 2020

EU Leaders One Step Closer To Agreeing On Recovery Fund

Monex Europe | The euro found support in anonymous reports this morning that the frugal four countries are now satisfied with €390bn of the fund coming in the form of grants. The initial proposal included a total of €500bn to be allocated in grants, but the leaders failed to find a compromise on the overall size over the weekend. The talks will resume at 4pm CEST today.

European economy 28th May 2020

The EU Recovery Fund Entails Partial Debt Mutualization And Fosters European Financial Integration

Axel Botte (Ostrum AM) | The EC recovery package “Recovery and Resilience Facility” draws on the joint France-Germany initiative to promote recovery efforts in Europe. Importantly, transfers across countries are no longer taboo. It is a great step forward to tackle increasing divergence in economic performances of member states. Under the proposal, the Commission will issue bonds with different maturities with the aim of minimizing funding cost.

In Europe 28th May 2020

Italy And Spain, The Countries To Benefit Most From The Recovery Fund: €172.8 Bn And €140 Bn, Respectively, Between Transfers And Loans

The Recovery Fund exceeds the Merkel/Macron proposals with an amount of €750 billion euros (equivalent to 5.4% of the EU27’s annual GDP). Italy and Spain would be the countries to most benefit. This was something that was quickly reflected in the performance of peripheral credit on Wednesday, especially in the financial sector, with improvements on average of about 10bp in the CDS of banks in both countries. For its part, France and Germany will receive transfers of 39 Bn and 29 Bn, respectively.