Friday April 30th 2021
25.6 billion for Germany
EU countries take their time with Corona aid
The European economy collapsed massively due to the Corona crisis. With billions in aid from Brussels, it should now be stimulated again. To do this, however, the EU countries have to break down how they want to spend the money. Germany’s plan is criticized.
Most EU states took their time with their applications for European corona aid by the end of this Friday. By late afternoon, only 5 of the 27 countries had submitted the required national development plans to the EU Commission in Brussels: Germany, France, Portugal, Greece and Slovakia. Further plans are still expected, said a commission spokeswoman. The deadline until April 30th is only an “orientation date”.
In the summer of 2020, the EU states agreed on a program worth 750 billion called Next Generation EU to overcome the deep Corona economic crisis and to finance important future investments. In the national reconstruction plans, the states must set out in detail what they want to use their share of the money from the RRF reconstruction fund for. Some governments have been negotiating details with the Commission for weeks in order to meet all requirements.
Numbers are difficult to compare
Italy and Spain are to get most of the money because they were hit hardest by the Corona economic crisis in 2020. Italy states its share in the EU program with 191.5 billion euros, Spain with up to 140 billion. France has applied for 40.9 billion euros. Greece 30.5 billion, Germany 25.6 billion, Slovakia 6.6 billion euros.
However, the figures are difficult to compare and partly estimated, because the formula applies: 70 percent of the proportion is calculated from the forecast slump in gross domestic product in 2020, 30 percent according to the actual development until mid-2022. In countries like Germany and France, this is only possible non-refundable grants. Italy, Spain and other countries, however, expect grants and loans.
Of the total of 750 billion euros, 672.5 billion will be distributed through the fund, the rest through other EU programs. Sometimes the governments add everything up. The sums originally mentioned correspond to prices from 2018. After adjusting for inflation, the total volume in current prices increases to a good 800 billion euros.
Criticism of the German plan
Germany is investing in the climate and the digital world and is therefore in line with the requirements agreed in the EU. According to this, at least 37 percent of the funds should flow into climate protection and 20 percent into digitization. The German development plan estimates 90 percent of the 25.6 billion euros for both topics together, including for hydrogen research, climate-friendly mobility and a more digitally oriented education system. The German plan is criticized for the fact that it hardly includes any new projects.
The development program is financed through debts that are to be repaid jointly from the EU budget by 2058. But before the EU Commission can take out loans on the capital market, all 27 states have to ratify the legal basis. Germany did this. It is still pending in eight countries. Second hurdle: The construction plans submitted have to be carefully checked and ultimately approved by the Council of EU countries. The first money will flow in July at the earliest.
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