By Jan Strupczewski

BRUSSELS (Reuters). – European Union may borrow together for shared goals like the post-pandemic recover, Paolo Gentiloni, European Economic Commissioner, said Monday.

Last year, the European Union agreed to borrow 800 billion euro ($903 billion) from each other to stop economic fragmentation caused by the COVID-19 pandemic. These funds will be used to rebuild their economies and make them more digitalized and greener.

A lot of people saw joint borrowing as breaking a taboo. The financial markets were enthusiastic about the decision, leading to speculation that the Next Generation EU recovery program could be turned into something more permanent — something which many north European countries strongly disagree with.

Gentiloni stated that “Indeed, it was an exceptional decision” in Strasbourg to the European Parliament’s Budget Committee in Strasbourg in response to a question from one of its members.

It was created as an ad hoc project, and it is in legal documents. This does not mean this method to fund a shared goal would be incompatible with the EU. This is not my opinion. Gentiloni stated that while I believe this can happen, it has nothing to do (with) making (it?) permanent.

Gentiloni said that “But to this we must succeed in implementation of the Next Generation EU” and with the challenge of raising more own resources. He was speaking of dedicated revenue streams for EU budget, from which 800 billion Euros of debt will be repaid.

Each of the 27 EU member countries involved in the scheme will receive grants and loans for low interest to help them reduce carbon dioxide emissions, and make their economies ready for the digital age.

After completing jointly set milestones and targets, the Commission will provide the money.

To help countries get their projects moving, the Commission already has disbursed pre-payments of 54 billion euro to 18 countries. As 22 countries are already in compliance with EU joint goals, the Commission has approved their spending plans.

The approval of the plans for Bulgaria and the Netherlands has been delayed by changes in the government. However, the Commission stated that good progress had been made in appraising the programme for Sweden.

However, approval for Hungary and Poland’s budget plans will face greater difficulties because the EU executive claims that Poland is not able to meet the criteria of having an independent judiciary. Meanwhile, Hungary faces corruption problems, which could threaten the correct spending of EU money.

($1 = 0.8864 euro)