Recommended citation
Rubio E. 2023. « Macro-economic impact of the EU Recovery Funds« , Institut d’Estudis Financers, 9 mars.

In June 2020, in response to the Covid-19 crisis, the EU leaders agreed on the establishment of an exceptional and temporary EU recovery plan. Known as “Next Generation EU”, the Plan amounts to €807bn in current prices (the equivalent of 5% of the EU 2020 GDP) and it is financed through the issuance of common EU debt. Most NGEU funds are allocated to a new EU programme, the Recovery and Resilience Facility (RRF), providing financial support to Member States in form of grants and loans to implement national, pre-agreed, multi-annual agendas of investments and reforms. Spain is one of the largest beneficiaries of the RRF, having received €77.4bn in RRF grants to be used between 2020 and 2026.

This article discusses the expected macro-economic impact of the EU Recovery and Resilience Facility (RRF), also known as the “EU Recovery Fund”. After describing the main features of the RRF, it presents the estimations made by the Commission and the ECB on the macro-economic impact of the RRF. Section three then discusses how the new macro-economic scenario generated by Russia’s invasion of Ukraine and the developing energy crisis may alter these estimations. Section four examines in greater detail the expected impact of the RRF funds in Spain. Section five sets out the conclusions.