PAN MEP supports Recovery Fund proposal of €750 billion

Lisbon, 27 May 2020 - MEP Francisco Guerreiro (PAN) views as positive the proposal for a Recovery Instrument of 750 billion euros to combat the impact of the crisis caused by the new Coronavirus, presented today by the President of the European Commission (EC).

In an extraordinary plenary session, Ursula von der Leyen explained the use of this amount to strengthen the European project, combat the impacts of climate change and ensure the economic and social sustainability of the regions most affected by the pandemic.

Affirming that the European Union must take “a bold step” together, the EC President presented the project dubbed 'Next Generation EU', which consists of 750 billion euros, of which 500 billion would be distributed in the form of grants and 250 billion euros in loans.

“We fell short of the need to invest and 100% finance the regions most affected by the pandemic, but a compromise was found that should serve as a basis for future negotiations at the European Council, meaning that 1/3 of the value of the Recovery Fund will be materialized in long-term loans. It is not the ideal situation, as Member States and the European business fabric are already deeply indebted, but it is a positive sign of possible convergence in the Council,” guarantees MEP Francisco Guerreiro. 

The Recovery Instrument would be financed by raising the so-called Own Resources ceiling - the maximum amount the EU can ask Member States to finance its expenses. The EC will borrow 750 billion from the market and incorporate them into the European Budget, distributing them among the Member States through a distribution key to be agreed, but prioritizing the most affected countries and regions. 

“It is now important to ensure that the Council and Parliament approve these investments and that they are channeled towards the European economic and social transformation towards a decarbonised model. Present and future generations cannot suffer from the poor implementation of the next community framework and this recovery fund. The European Green Deal must be the engine of all these transformations,” says Francisco Guerreiro.

From this Recovery Fund, it is estimated that Portugal could receive up to €26.4 billion (of which 15.5 billion in direct grants). 

“Although the proposal for the Multiannual Financial Framework is well below what the European Parliament wants, the Recovery Fund, presented today by the Commission, is a qualitative leap for the European project. Faced with an unexpected crisis, with a huge impact on all countries, the Commission comes forward with a robust Investment plan, composed mostly of grants, demonstrating that the EU, when faced with crises, moves forward in a determined and solidary way,” concluded the MEP.  

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