In Brussels today, the Portuguese Prime Minister, António Costa, signed the formal approval of the Recovery and Resilience Facility (RRF) on behalf of the Council of the European Union (EU). The RRF will be used to fund the national recovery plans of the Member States.
Through this approval, the RRF has now officially come into force and the Member States can formally submit their recovery plans to the European Commission for approval.
The Recovery and Resilience Facility (RRF) is the main pillar of the European recovery plan, Next Generation EU, designed to provide financial aid to Member States in order to combat the economic and social effects of the COVID-19 pandemic and make the European economy more resistant to future shocks.
The RRF will have a financial provision of EUR 672.5 billion, of which EUR 312.5 billion will be in the form of grants, with the remaining EUR 360 billion in loans.
The RRF funds will be released to the Member States after approval of their national plans by the European Commission and by the Council of the EU. The funds are to be used to finance the reforms and investments included in these plans.
The national recovery plans will be required to respect certain rules: they must be in line with the strategic priorities of the EU and with the specific recommendations for each Member State regarding how their economic policy is conducted. They should also support the green and digital transitions, allocating 37% and 20%, respectively, of the total value of the plans to these areas.