The European Council announced on Monday that the European Union will launch its recovery plan to address the economic impacts of the coronavirus in June, after it was approved by the 27 member states of the bloc. Portuguese Prime Minister Antonio Costa, whose country holds the rotating presidency of the Council, stated that "the European Council is now able to secure the necessary financing for the European economic and social recovery plan."
The Commission will be able to access financial markets and borrow amounts to finance the plan on behalf of the EU member states. The plan, valued at 750 billion euros, was approved in July 2020. However, the Commission's ability to borrow on behalf of the bloc required the approval of the 27 member states for the plan.
The European economic recovery plan includes a fund for joint borrowing among all member states to reduce the costs on less financially capable countries, a step long opposed by "austere" northern countries. Costa mentioned that "the governments and national parliaments of the 27 member states demonstrated a strong sense of solidarity and responsibility." He added, "We cannot afford to waste any more time," emphasizing the need to ensure a swift approval for the first recovery and adaptation plans by the end of June.
French Minister for European Affairs Clément Beaune stated in an interview with "Les Echos" that the European Union will begin outreach to major international and European banks starting Tuesday. The parliaments of Austria and Poland were the last to approve the joint borrowing mechanism, having done so on Thursday.
Spain and Italy, heavily impacted by the pandemic, will be the primary beneficiaries of the fund, with each country expected to receive around 70 billion euros. The funds are set to be allocated for major infrastructure projects and environmental initiatives, such as the development of electric vehicle charging station networks. Additional funding has also been earmarked for enhancing high-speed communication networks and data storage facilities.
