Members' Research Service By / July 28, 2022

The digital dimension of the National Recovery and Resilience Plans

The ongoing digitalisation of economies and societies around the world is giving rise to global transformations and affecting almost every domain of the EU’s economy, policies and citizens’ lifestyles in general.

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Written by Velina Lilyanova.

The Recovery and Resilience Facility (RRF) is the core element of the EU’s largest and most innovative financing instrument, Next Generation EU (NGEU), created to help the EU’s economies and societies recover from the global pandemic. The facility is structured around six pillars representing policy areas of European relevance, identified by the RRF Regulation as vital for strengthening the EU’s resilience. The pillars define investment priorities and the scope of application of financing under the RRF. This briefing is dedicated to one of them – the digital transformation pillar – for which, along with the green transition, the RRF Regulation sets a specific spending target. The briefing aims to give an overview of why the digital transition is one of the key policies in focus under the RRF, what the RRF Regulation requires in that respect, and the approach taken by EU Member States.

To receive funds from the RRF, Member States have drawn up individual national recovery and resilience plans (NRRPs), laying down a number of reforms and investments. Funds are released based on performance, upon successful implementation of relevant milestones and targets set out in the plans. Each national plan has to earmark at least 20 % of its resources for achieving digital targets. Digitalisation has been under way for a long time and the EU’s response to this process, even before the pandemic, has been indicative of the high priority it gives to this policy area. The digital transition, one of the ‘twin transitions’, is not only considered key to a faster economic recovery, but also to enhanced security and resilience, and to the EU’s achieving strategic autonomy. NGEU provides an opportunity, among other EU policy tools, to contribute to progress in that area.

While the RRF’s time scope is relatively limited, as investments are due to be completed by 2026, it falls within the recently declared EU Digital Decade 2020-2030. The NRRPs are aligned with the overarching priorities to achieve the EU’s digital objectives by 2030. Digital investment is urgently needed across Europe, and a substantial investment gap in digital infrastructure and services has been estimated between the EU and its global competitors. Thus, funding for digital targets in the RRF is expected to complement funding from EU and national budgets and address this challenge.

Read the complete briefing on ‘The digital dimension of the National Recovery and Resilience Plans‘ in the Think Tank pages of the European Parliament.

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