The Portuguese Minister of State for Finance challenged the Member States to finalise their Recovery Plans in the next two weeks. João Leão, who chaired the ECOFIN – Economic and Financial Affairs Council meeting today acknowledged the efforts being made by different countries to finalise their national plans, but warned that “it's time to move on to the next phase”.
“We're on the final stretch. It's time to deliver, so that the first tranche can be approved by ECOFIN by the summer”, the Minister stressed, pointing out that “it is equally urgent for all the Member States to ratify the Own Resources Decision. The Commission can only issue debt to fund the Recovery Programme when this process has been concluded”, he said.
What is at stake is the instruments for economic recovery in the European Union after the COVID-19 pandemic, particularly the application of the Recovery and Resilience Facility and the funding of the Next Generation EU programme. So far, 17 Member States have concluded the process.
On this subject, the European Commission presented its strategy for funding Next Generation EU, anticipating market funding of EUR 806 billion by 2026, at a rate of around EUR 150 to 200 billion a year. The Council and ECOFIN expect to be able to begin mobilising funds by June.
Positive outlook for recovery in the second half of the year
Although there is still major uncertainty due to the pandemic and the lockdown measures necessary to contain COVID-19 in Europe, the EU Finance Ministers discussed the outlook for the European economy.
Several countries are still dealing with new waves of the pandemic. However, the economic impact of the most recent lockdowns has been less severely felt and we are now beginning to see the first signs of recovery.
With the progress of the vaccination campaigns, the outlook for economic growth for the second half of the year is now very positive.
Also taking part in this ECOFIN meeting, chaired by Minister João Leão from the headquarters of the Portuguese Presidency of the Council of EU in Lisbon, was the Vice-President of the European Commission, Margrethe Vestager, who gave an overview of the support measures for companies during the pandemic, implemented under the scope of the Temporary Framework for state aid.
Reinforcement of the Capital Markets Union
The Ministers also discussed a very ambitious project to reinforce the Economic and Monetary Union, the Capital Markets Union. A stronger capital market makes it possible to diversify sources of funding for European companies and create new investment opportunities. This will be vital for supporting economic recovery, strengthening the international role of the euro and increasing the resilience of the European Union.