Kick-starting the future – promoting investment and innovation
In addition to the EU solidarity package amounting to €540 billion, the issue of how to overcome the crisis and its costs in the medium to long term will be a key priority of Germany’s Council Presidency. For this reason, Germany teamed up with France in May 2020 to propose a large European recovery fund. The European Commission developed this proposal into a comprehensive recovery plan. The heads of state and government of the EU member states agreed on the Next Generation EU recovery plan at the Special European Council of 17-21 July 2020, thus sending out an important signal of solidarity, cooperation and willingness to carry out reforms in Europe.
The recovery plan will run from 2021 to 2023 and will have a total volume of €750 billion. The European Commission will be able to borrow the necessary resources on the financial markets, allowing it to support the hardest-hit countries and regions with grants and loans. This borrowing by the European Commission will, however, remain an exception. It will have a clearly defined scope, be time-limited and be tied to binding repayment requirements. Taken in total, European assistance measures will add up to the enormous amount of nearly €1.3 trillion – and this does not even include the comprehensive national assistance programmes.
The decisions on the recovery plan is closely tied to the European Council’s decision on the Multiannual Financial Framework, which sets out the EU budget for the next seven years. These decisions now need to be implemented in cooperation with the European Parliament.