EU lawmakers approve recovery package | Ralph-Lauren

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European Parliamentarians have approved the bloc’s Resilience and Recovery plan, paving the way for member states to access almost 700 billion euros ($A1.33 trillion) in loans and grants to overcome the economic effects of the coronavirus crisis.

The grants – about 300 billion euros – will be dispersed for investments and reforms to stimulate countries’ economies. To access the money, EU countries have to submit their spending plans by April 30.

The commission and EU countries will then have to agree to each plan.

In its vote on Tuesday, the results of which were published on Wednesday, the parliamentarians approved the plan by an overwhelming majority.

During the debate on the vote on Tuesday, Siegfried Muresan, a parliamentarian involved in the negotiations, said the funds should be used to modernise the countries’ economies.

“This money must not be used for ordinary budgetary expenditures but for investment and reforms,” he said.

The member states still have to formally assent to the recovery package, but no major obstacles are expected for this.

A bigger hurdle to clear will be the passing of the so-called Own Resources Decision, which will allow the EU to borrow money at the markets. Much of the recovery package is envisaged to be financed through this tool.

Once this has been ratified and national plans have been approved, the commission could disperse money to the governments – but money is not expected to flow for several months given the complex procedures and scrutiny it is tied to.

So far, all but three countries have submitted their draft plans or some parts of them, a senior EU official said on Monday, but many plans still need major revisions before being approved.

The EU’s recovery plan will cover measures to be implemented from February 2020 until August 2026. Projects already approved before the recovery plan was created could also be financed.

As part of their national plans, governments have to commit to a 37 per cent target for environmental spending and 20 per cent for digital objectives.

Non-governmental organisations have criticized a lack of transparency, with only a few countries having made their spending plans public. This, they say, prevents the public from scrutinizing whether planned spenditures actually served the stated goals.


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