The European Commission has presented a proposal
to amend the Multiannual Financial Framework (MFF) for 2021-27 of the
EU budget – integrating a recovery plan as a post-Covid response. Many
elements of the plan are clearly in line with the ‘Next Generation EU’
term of the recovery, not because of its contents but because for the
first time the EU is taking a much-needed next step towards monetary
union: the ability to raise funds from the financial markets to manage
asymmetric negative economic impacts in member states, backed by the
Union as a whole.
Perhaps surprisingly, the proposal goes beyond the Macron-Merkel proposals of 19 May. The European Commission proposes raising €750 billion from the financial markets to be repaid between 2028 and 2058, using the high credit rating of the EU to obtain very favourable conditions. It will allocate the revenue directly to the EU budget under the existing headings, even if it uses the special provisions determined by the specifics of the crisis. This makes it easier – at least in principle – for spending to follow EU priorities. (...)
Perhaps surprisingly, the proposal goes beyond the Macron-Merkel proposals of 19 May. The European Commission proposes raising €750 billion from the financial markets to be repaid between 2028 and 2058, using the high credit rating of the EU to obtain very favourable conditions. It will allocate the revenue directly to the EU budget under the existing headings, even if it uses the special provisions determined by the specifics of the crisis. This makes it easier – at least in principle – for spending to follow EU priorities. (...)
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