|Author (Corporate)||European Commission: DG Budget|
|Series Details||COM (2021) 250|
Communication published by the European Commission on 14 April 2021, setting out a funding strategy aimed at ensuring the availability of funds required to fulfil the objectives of the EU Recovery Instrument.
The European Union Recovery Instrument - also known as the Next Generation EU (NGEU) - is a temporary instrument aimed at supporting economic recovery following the COVID-19 (coronavirus) pandemic. It can raise up to €750 billion (2018 prices) through bond issuance. In this context, the European Commission is to borrow on the capital markets on advantageous conditions due to the EU's high credit rating. The benefit is then passed on to the EU Member States directly when providing them loans or to the EU Budget in the form of low interest rate payments on borrowings to finance recovery spending. The borrowing is to be concentrated between 2021 and 2026.
While the Commission has borrowed on previous occasions, the volumes, frequency and complexity of the NGEU borrowing called for a fundamental change in the approach to capital markets. This Communication therefore calls for an overhaul of how the Commission raises funds through bond issuance. It is adopted in accordance with Council Decision 2020/2053. Alongside this Communication, the Commission also adopted a Decision on the governance arrangement and risk management systems for NGEU and a Commission Decision on the Primary Dealer Network.
|Subject Categories||Economic and Financial Affairs|
|Subject Tags||Economic Governance | Situation, EU Budget|
|International Organisations||European Union [EU]|