EU unveils €750bn stimulus package for Covid-19 recovery
The European Commission today unveiled a huge €750bn (£670bn) stimulus package to help lift the bloc out of a sharp recession caused by the coronavirus pandemic.
The package is set to be divided between €500bn in grants and €250bn in loans, which will be borrowed on financial markets and dispersed to member states.
Mandarins hope the support plan will prevent a splintering in the 27-nation bloc caused by divergent levels of economic recovery and growth.
Countries such as Italy, France, Spain, Greece and Portugal are all expected to struggle to restart their economies through borrowing due to high levels of debt and their reliance on tourism.
This compares to more frugal northern nations such as Sweden, Norway and the Netherlands, which have pushed back against plans for a recovery package based on grants.
The recovery fund comes in addition to the bloc’s budget for 2021-2017, which was today set at €1.1 trillion.
“The Commission is today proposing a new recovery instrument, called Next Generation EU, within a revamped long-term EU budget,” the EU said in a statement.
“In total, this European Recovery Plan will put €1.85 trillion to help kick-start our economy and ensure Europe bounces forward.”
The euro jumped 0.4 per cent against the dollar to $1.102 following reports of the package.