Due to economic growth, Belgium threatens to receive 1.35 billion euros less from the European recovery plan. That should help Member States with the financial hangover caused by Covid.
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The European Commission awarded our country EUR 5.9 billion from the European Recovery and Resilience Facility. This is the European investment fund that should help finance greening and digital transformation in the Member States. That money has meanwhile been divided between the federal government and the federal states and paid out in tranches. All of them partly finance their own investment plans with that money.
But State Secretary for Budget Eva De Bleeker (Open VLD) now warns that the amount that Europe will pay out may only amount to 4.55 billion euros. After all, the 700 billion euros from that fund will be distributed on the basis of a distribution key in which economic growth in 2020 and 2021 plays an important role. Since the Belgian economy has experienced a significant recovery in recent months, there may be less money coming out of that fund to Belgium. That would mean that the division between the federal government and the regions would have to be discussed again and several investment projects would possibly have to fail. Unless they are self-financed. But that is not obvious given the large debt burden that our country is already burdened with.
‘It is a good thing that our economy is picking up so fast. But the fact that less money would be provided from Europe as a result is wry,’ responds Flemish Minister of Budget Matthias Diependaele (N-VA). ‘The good governance of the best students in the class, and therefore the countries or regions where the economy has recovered more quickly, is punished, as it were. In this way, the EU seems to be increasingly becoming a transfer union. The countries that do less well are rewarded with this. And on the other hand, how much better your recovery works, how much less money you receive.’ The minister also reiterates the promise that the Flemish recovery plan will be fully implemented.
The final amount to which Belgium is entitled will be known in June 2022.
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