The elements of the EU recovery plan, objectives and mechanisms, are now sketched out. But the launch of this innovative engine still lacks two essential moves.
First, the recent agreement on all the elements of the financial ‘package’, including the rule of law provisions, means that ratification by national parliaments of the revised Own Resources Decision can start. Given the current extraordinary circumstances, it is hoped that all 27 Member States accelerate and complete this process within six months instead of the more than two years it would usually take. This is a necessary step to enable the Commission to borrow, for the first time, the necessary funds on the capital markets and finance the recovery instrument.
Second, Member States are preparing reliable national recovery plans, on how they intend to spend the funds, to be submitted by the end of April 2021 for the Commission’s assessment and Council’s approval. Governments have started to draw up these proposals around seven flagship areas, on the basis of the guidelines presented by the Commission. It is about mobilising the necessary investments and introducing structural reforms under six European priorities. These are the just and green transitions, digitalisation, economic and social cohesion, competitiveness, and increased resilience to crisis. Member States will then be able to launch the investment projects with 13 % pre financing upon the approval of the recovery and resilience plans, and commit 70 % of the grants at the latest by end-2022. Actual disbursement is conditional upon the fulfilment of the pre-agreed milestones and targets.
Will the EU succeed in turning the crisis of this pandemic into an opportunity by supporting the recovery but also by investing in our future, as European Commission President Ursula von der Leyen has stated? All this is to watch out for in 2021 and in the years to come.