Recovery Fund: the Marshall plan is ready, an EU 2,000 billion proposal – Europe


The Marshall Plan of the European Commission to revive the Union’s economy is ready. All inclusive, it will manage to mobilize more than 2,000 billion over the next seven years, that is more than double a traditional European budget. Although most of the funds will be available starting next year, in 2020 it will be possible to anticipate something of that Recovery fund which should be around 500 billion.

Ursula von der Leyen tried to please everyone: who wanted mostly grants and who wants to grant aid only in exchange for reforms. There will be both aspects, hoping that for the 27 it is an acceptable proposal, to which to give the go-ahead quickly. Because the funds will only start to reach the capitals after a definitive agreement at the European Council. As anticipated by von der Leyen the same months ago, the Recovery plan will use the next EU budget as a basis. States will be asked to increase the ‘theoretical’ effort a little, that is, not how much they really pay in the budget but how much they are called to commit (headroom). It is a theoretical voice, thanks to which the Commission will go to the market to raise funds, guaranteed in all respects by the common budget. For reasons of timing, this operation can only start from 2021, therefore to start the aid immediately, for now it will be necessary to increase the ceiling of the current budget.

Brussels intends to distribute the funds through three channels, which have also been known for the past few days: the main one is the Recovery and resilience instrument, which will above all give grants, and then loans, to the countries most affected by the crisis. The proportions could be 70 to 30, or 60 to 40. Each country will be able to request its support, if it wishes, by preparing an investment and reform plan that follows the EU recommendations published in May, to be submitted to Brussels for approval. The Commission wants to make sure that countries spend in a way that is consistent with common objectives, that is, in the digital and energy transition. The other funds will then be distributed through the program ‘InvestEU’ which aims at strategic investments, and on a tool for the recapitalization of companies (Solvency) that got into difficulties with the Covid crisis, which will bring funds through national promotion banks. The Commission’s aim is to reduce the current economic fragmentation, where those who had more budget space could spend more, and those who had not been left behind.

Not surprisingly, a survey by the EU Parliament revealed that Italians are the most dissatisfied the solidarity shown so far between the EU Member States, and together with the Spaniards they have had the greatest financial problems. The Brussels proposal will only be the beginning of the confrontation between the leaders, which will have its truth moment at the summit on 18 June. Prime Minister Giuseppe Conte went ahead with diplomatic work and heard Dutch colleague Mark Rutte. Conte insisted on the need for Europe at this moment to equip itself with an “ambitious” Recovery Fund, also useful for protecting the internal market in an adequate manner. An allusion, probably, also to the age-old question of Dutch tax dumping. But, at least for now, the Netherlands together with the ‘frugal’ allies do not change their position on aid: the emergency fund must only provide loans, “without any debt mutualisation,” reiterated Rutte.

I expect an ambitious proposal“. The Minister of Economy, Roberto Gualtieri, said about the plan for the European recovery fund that will be presented tomorrow by the President of the European Commission Ursula von der Leyen.” We – Gualtieri told Tg2 Post – are for a recovery fund as broad as possible. We have interloquitoed these days with the Commission. What matters is how many resources it will have, how it will be allocated and the balance between grants and loans: we will evaluate on the basis of all these ingredients “.

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