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The Facility RRF and NextGenerationEU

21 July 2020, the European Council (proposal Commission, 2 April 2020. Brussels)

Monday 15 February 2021, by Carlos San Juan

NextGenerationEU is a temporary recovery instrument that allows the Commission to raise funds to help repair the immediate economic and social damage brought about by the coronavirus pandemic. The NextGenerationEU includes: First the Recovery and Resilience Facility (RRF) The Recovery and Resilience Facility (the Facility) will make €672.5 billion in loans and grants available to support reforms and investments undertaken by the Member States. Secon the REACT EU with €47.500 billion.

The Facility and NextGenerationEU

includes two main funds:


the Recovery and Resilience Facility, RRF, with €672.5 billion

Secon the [

REACT EU with €47.500 billion

is an initiative that continues and extends the crisis response and crisis repair measures delivered through the Coronavirus Response Investment Initiative and the Coronavirus Response Investment Initiative Plus.

National recovery and resilience plans

Member States will prepare recovery and resilience plans that set out a coherent package of reforms and public investment projects. To benefit from the support of the Facility, these reforms and investments should be implemented by 2026.

The plans should effectively address challenges identified in the European Semester, particularly the country-specific recommendations adopted by the Council. The plans should also include measures to address the challenges and reap the benefits of green and digital transitions.

Each plan is expected to contribute to the four dimensions outlined in the 2021 Annual Sustainable Growth Strategy, which launched this year’s European Semester cycle.

The four dimensions of environmental sustainability, productivity, fairness and macroeconomic stability identified in the 2020 Annual Sustainable Growth Strategy should remain the guiding principles underpinning Member States’ recovery and resilience plans. These priorities lie at the heart of the European Semester and ensure that the new growth agenda does the best for people and the planet.

1.-Environmental sustainability.

EU green deal


Investing in sustainable mobility can also strongly support recovery. Measures addressing transport can bring significant greenhouse gas emission reductions and improvements to air quality while fostering productivity growth.

Digital transition and productivity

Member States should ensure a high level of ambition on the digital transition as part of their recovery and resilience plans. The Recovery and Resilience Facility represents a unique opportunity to foster the digital transformation of all economic or social sectors, including public services. To ensure effective implementation, the Commission proposes that each recovery and resilience plan includes a minimum level of 20% of expenditure related to digital.


The recovery and transition process needs to be fair for all Europeans to prevent growing inequalities, ensure support from all parts of the society and has to contribute to social, economic and territorial cohesion. The Recovery and Resilience Facility will help Member States address their structural challenges that have been identified since many years as part of the European Semester and that have been amplified by the COVID-19 crisis. While short-time work schemes helped to contain the impact of the crisis on employment, labour market conditions are deteriorating, with unemployment expected to rise sharply in several sectors and parts of Europe. The situation of the youth requires particular attention. Every effort should be made to prevent unemployment and social exclusion from becoming entrenched and facilitate the adaptation of the labour market, called for by the green and digital transitions. It will also be important to foster convergence and improve the resilience of the regions, in particular to reduce territorial disparities.

4.-Macroeconomic stability

Member States should continue to provide targeted and temporary fiscal support in 2021 in a context where the General Escape Clause is activated, while safeguarding fiscal sustainability in the medium term. They should gradually shift from a protective emergency response to measures that facilitate a reallocation of resources, and support the recovery. When economic conditions allow, fiscal policies should aim at restoring prudent medium-term fiscal positions and ensuring debt sustainability, while enhancing investment. Replenishing fiscal buffers over time will be important to be prepared for future crises. The activation of the General Escape Clause does not suspend the procedures of the Stability and Growth Pact.

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