Recovery package gives Europe chance to emerge stronger from this crisis

EVP Dombrovskis: EU economy should return to pre-pandemic GDP levels in 2022

Photo: EU Valdis Dombrovskis.

During their informal video conference, EU economic and finance ministers examined closely the current economic situation and outlook. Prior to the discussions, the Commission gave a recap of its 2021 winter forecast and the European Central Bank zoomed in on financial stability related matters. Ministers also discussed the implementation of the measures agreed last year as part of the EU’s response to the Covid-19 pandemic.

The Portuguese presidency emphasized that the regulation establishing the Recovery and Resilience Facility is expected to enter into force on 19 February.

Member States will then be able to start officially submitting their recovery and resilience plans to the Commission as to bring closer the use of the €672.5bn Recovery and Resilience Facility.

EC Executive Vice-President and Commissioner for Trade, Valdis Dombrovskis underlined that growth should resume in the spring and gather momentum as vaccination campaigns advance, pressure on health systems starts to subside and containment measures ease.

 According to him, the EU economy should return to pre-pandemic GDP levels in 2022, earlier than previously forecasted.

In the meantime, we still have to contain the socio-economic fallout and that is no easy task, he pointed out adding that the Next Generation EU recovery package and its centrepiece Recovery and Resilience Facility will give further support, provided that its funds are well spent and go hand in hand with effective reforms.

He recalled that the €750bn recovery package opens up a unique chance so that Europe emerges more resilient from the crisis and better prepared for a green and digital future.

EVP Dombrovskis also said that the Commission is working hard to put all elements in place for the finalising operations of Next Generation EU, which will be done through market funding of up to €750bn in 2018 prices, or some €800bn in current prices.

The Commission is expected to present a communication on its borrowing and lending operations in April.

The ongoing preparation of the national recovery plans and their priorities was also an item on the ECOFIN agenda. The participants agreed on the importance of mobilising all efforts in order to present comprehensive and ambitious plans as soon as possible.

It is of utmost importance to finalise the national recovery and resilience plans in an efficient and thorough manner, to allow for a positive assessment and rapid disbursement of much-needed funds, João Leão, Portugal’s Minister for Finance underscored.

During the informal meeting the EU executive also gave an overview of its borrowing operations under SURE, the European instrument for temporary support to mitigate unemployment risks in an emergency. The bonds have drawn a high level of interest among investors, resulting in favourable pricing terms.

The Presidency informed ministers about the state of play regarding the ratification of the own resources decision, highlighting the importance of a speedy conclusion of the process.


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