If recent delays in the implementation of Pnrr in Italy have prompted some government officials to propose to give up some of the resources of the European bailout (fueled by EU loans), Spain is taking a completely different route: Pedro Sanchez’s plan executive, under the European Commission’s NextGenerationEU He wanted it to be able to receive additional financing of 95 billion euros, thus doubling its total budget.
That’s in large part the amount of credit Brussels has given Madrid as it splits the bailout pie between the states. Spain initially refused to activate these loans, preferring to focus on non-refundable subsidies. According to the NextGenerationEU regulation, Madrid had until 2023 to request additional funding. The political situation accelerated, with Sanchez’s decision to call snap elections in June, prompting the centre-left Spanish government to hasten the decision and timing. The demand for access to loans includes commitments to implement 18 reforms and 25 more major investment plans, 28 billion of which are for strategic industrial projects.
The new workload does not seem to have worried Madrid. So far, Spain has collected around 37 billion of the 77 envisaged subsidies in total from the EU, just under 50% of the total amount of non-refundable aid. Counting subsidies alone, Italy stands at 28 billion just to make a comparison. Of course, there are also difficulties in the execution of projects in Spain, but for now there has been no delay in the roadmap and the last tranche of funds was distributed by Brussels last March.
Now, 95 billion more spending challenges, 84 of which are loans. For Madrid, delaying the demand for the second part of the Pnrr funds could have been an advantage compared to our country, for example: the new plan takes into account the economic scenario set by the war in Ukraine and by inflation. Two factors that weren’t there when Italy negotiated its Pnrr with Brussels and that the government of Giorgia Meloni took advantage of to alter the deals made by his predecessor, Mario Draghi.
For Meloni, then, Spain’s demand for access to loans could be bad news: in fact, other states might be required to fulfill these loans if these resources were not used by those who originally claimed them (i.e. Madrid). RePowerEU projects, the energy transition plan initiated by the Commission in response to the Ukraine crisis. It is no coincidence that with the activation of the new funds, Spain presents a project and reform division exactly according to this plan: 8 billion “aims to save the country more from Russian fossil fuels”, writes the Commission.
Source: Today IT
Karen Clayton is a seasoned journalist and author at The Nation Update, with a focus on world news and current events. She has a background in international relations, which gives her a deep understanding of the political, economic and social factors that shape the global landscape. She writes about a wide range of topics, including conflicts, political upheavals, and economic trends, as well as humanitarian crisis and human rights issues.
