London, July 21 (HNA) – European Council (EC) President Charles Michel said, “We did it. Europe is strong. Europe is united.” after the European Union (EU) leaders agreed a recovery package and the 2021-2027 budget that will help the EU to rebuild after the pandemic and will support investment in the green and digital transitions.
President Michel at the press conference of the European Council said, “We have reached a deal on the recovery package and the European budget. These were, of course, difficult negotiations in very difficult times for all Europeans. A marathon which ended in success for all 27 member states, but especially for the people. This is a good deal. This is a strong deal. And most importantly, this is the right deal for Europe, right now.”
Remarks by President Charles Michel after the Special European Council, 17-21 July 2020
The socio-economic fallout from the COVID-19 crisis requires a joint and innovative effort at EU level in order to support the recovery and resilience of the member states’ economies.
To achieve the desired result and be sustainable, the recovery effort should be linked to the traditional MFF, which has shaped EU budgetary policies since 1988 and offers a long-term perspective.
EU leaders have agreed to a comprehensive package of €1 824.3 billion which combines the multiannual financial framework (MFF) and an extraordinary recovery effort under the Next Generation EU (NGEU) instrument.
The new Multiannual Financial Framework (MFF) will cover seven years between 2021 and 2027. The MFF, reinforced by Next Generation EU, will also be the main instrument for implementing the recovery package to tackle the socio-economic consequences of the COVID-19 pandemic.
The size of the MFF – €1 074.3 billion – will allow the EU to fulfill its long-term objectives and preserve the full capacity of the recovery plan. This proposal is largely based on the proposal made by President Michel in February, which reflected two years of discussions between member states.
The MFF will cover the following spending areas:
– single market, innovation and digital
– cohesion, resilience and values
– natural resources and the environment
– migration and border management
– security and defence
– neighbourhood and the world
– European public administration
Next Generation EU will provide the Union with the necessary means to address the challenges posed by the COVID-19 pandemic. Under the agreement the Commission will be able to borrow up to €750 billion on the markets.
These funds may be used for back-to-back loans and for expenditure channelled through the MFF programmes. Capital raised on the financial markets will be repaid by 2058.
€390 billion from the package will be distributed in the form of grants to member states and €360 billion in loans.