The package will need to be ratified by the European Parliament before it is implemented
European Union (EU) leaders have reached a landmark deal on a post-novel coronavirus disease (COVID-19) recovery package. The European Union will offer €750 ($859) billion in grants and loans to counter the pandemic’s economic impact.
The European Union summit began in Brussels on July 17, 2020 and the leaders agreed on the deal after 90 hours of talk on July 21. The European Commission, the European Union’s executive body, can now raise billions of euros from the international capital market.
This is going to be the largest joint borrowing ever agreed by the European Union. It is an exceptional move of solidarity in 70 years of European integration.
A grant of €390 billion will be available to member states hit hardest by the pandemic. €360 billion will be available on low-interest rates to members of the union.
Italy and Spain, hit hardest by COVID-19, are expected to be the main beneficiaries.
The package will need to be ratified by the European Parliament before it is implemented.
The huge economic package will clear the way for the member states to maintain spending to heal the economy from the damages that have been caused by the COVID-19 lockdown across Europe. The packages come with checks to prevent misuse of the funds. Beneficiaries have to submit plans of spending to European Commission, also a majority of states can block projects.
Charles Michel, the president of the European Council tweeted saying “We did it! We have reached a deal on the recovery package and the European budget for 2021-2027. This is a strong deal. And most importantly, the right deal for Europe right now”.
Leaders expressed hope that the €750 billion recovery package as well as a budget of €1.1 trillion for 2021-2027 period can help repair Europe’s worst recession after World War 2.
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