Thursday, February 2

The Government approves the addendum to the Recovery Plan that adds 7,700 million in subsidies and 84,000 in loans


The First Vice President and Minister for Economic Affairs, Nadia Calviño, presented on Tuesday the main characteristics of the draft addendum to the Recovery Plan at the press conference after the Council of Ministers. “This is the second phase for the full deployment of the European funds that correspond to Spain”, she has defended. In total, 160,000 million, which “will increase the level of GDP (Gross Domestic Product) by up to 3 percentage points until 2031.”

The Bank of Spain rules out recession and warns of more inflation in 2024 if the Government withdraws the shock measures

Plus

This update incorporates three important new features. The first, to assign the additional transfers that correspond to Spain. This supposes some extra subsidies of 7,700 million. The second is to allocate the loans from the Recovery and Resilience Mechanism. Spain may request up to a maximum of 84,000 million euros from the European Commission.

And third, allocate funds from the REPowerEU Plan, whose objective is to save energy, increase the production of clean energy and diversify Europe’s energy sources. In the provisional distribution of the fund, an additional 2,586 million euros has been provisionally assigned to Spain.

As defended by the Government, “the addendum will give continuity to the ambitious reforms and investments of the Recovery Plan, in line with its strategic objectives (ecological transition, digital transformation, social and territorial cohesion and gender equality) with a focus on the strategic autonomy through strategic projects, known as PERTE”.

Rhythm of calls of 2,000 million per month

As Calviño has announced, the project will be presented to the European Commission at the beginning of 2023. The addendum to the Recovery Plan is an update of the document approved in July 2021. It was expected to be presented by the Government to the European Commission in the second half of 2022, and the Executive has met this deadline.



Until now, “the public information on the execution of the Plan shows a credit commitment from the State of more than 38,000 million euros, between calls and transfers to the Autonomous Communities, and resolved calls for 22,000 million euros, charged to the budget items of the Recovery Plan”, has defended the Ministry of Economic Affairs.

Impulse of the addendum

With the additional investments and reforms, the Government intends to reinforce the structural economic impact of the Recovery Plan, “with a strong focus on promoting the industrialization and strategic autonomy of Spain in the energy, agri-food, industrial, technological and digital fields, contributing to respond to current geopolitical challenges”.

“Spain will reinforce the strategic projects (PERTEs) with more than 26,300 million euros of additional public investment from the transfers and loans of the addendum”, he highlighted this Tuesday. “In addition, a new PERTE for industrial decarbonization will be launched, to which 3,100 million euros will be allocated between transfers and reimbursable financing, including a compartment especially for the gas-intensive industry,” he added.



The 84,000 million in loans will be channeled through twelve funds, which will make it possible to extend the current investment cycle in the coming years, guaranteeing economic and financial stability, as well as long-term fiscal sustainability. Specifically, a new fund of 20,000 million euros will be created to channel loans to sustainable projects and investments in the Autonomous Communities.

Additionally, the ICO will channel up to 15,000 million euros in loans to finance green investments by companies and reinforce financial support for SMEs, “which will allow them to adapt to the new economic framework of sustainability and improve their competitiveness”, the Ministry of Economic Affairs.



“The addendum includes a complementary reform program to those already deployed since February 2020, compliance with which, recognized by the EU, is already having a positive effect on the structural transformation of the Spanish economy,” he concluded.



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