First Vice President and Minister of Economy Nadia Calviño presented this Tuesday the addition to the Recovery, Transformation and Resilience Plan. At the press conference after the Council of Ministers, the ‘number two’ Government announced the general guidelines that will make this possible launch the second phase of this program with 160,000 million euros, will enable the full distribution of European next generation resources. The government believes that 84,000 million euros in loans that Spain can request as a maximum help sustain investments until 2026.
Credits will be channeled through twelve funds (eight of them newly established) that will enable “maintaining the flow of public and private investments” and will be allocated to the production fabric and regional projects. There will be an Autonomy Fund allocated with up to 20,000 million euros that will provide regional governments with financing under preferential conditions for transfer to the private sector and to cover public investments of a sustainable nature.
Except, an additional 15,000 million will go to strengthen the funds of the Official Credit Institute (ICO) aimed at providing liquidity to SMEs and the self-employed for investments in renewable energy sources, energy efficiency and the circular economy, which will also enable the consolidation of the development of sustainable finance in Spain. In addition, the executive power ensures the creation of financial instruments to support social investments in the audiovisual field as well.
Energy transition, key
The addition will enable the mobilization of an additional EUR 7,700 million in transfers that will go towards strengthening the eleven strategic projects for economic recovery and transformation (known as Perte) that are currently underway. They will enable, at the same time, launch a Port for decarbonization worth 3,100 million euros. The latter, as well as chips and ERHA (PERTE renewable energy, renewable hydrogen and storage) will be the ones to receive the most additional resources due to their importance in strategic areas.
Spain will commit more than 26,300 million additional public funds for strategic projects. In addition, within the framework of the agreement reached in the European Council on the ‘RePowerEU’ plan, which includes the allocation of almost 2,600 million euros to Spain, the country will be able to accelerate investments in the field of energy transition (introduction of renewable energy sources, storage and development of green hydrogen, energy efficiency… .)
Addendum resources will focus on promoting industrialization and strategic autonomy in the five axes or dimensions: energetic; intensify agricultural and food autonomy; promote industrial autonomy through decarbonization, digitalization, promotion of the circular economy; technological – to mitigate the risk of disruptions in supply chains such as those that occurred with Covid; as well as actions that enable the acceleration of digitalization and the strengthening of cyber security.
The funds will increase GDP by three percentage points per year until 2031
Calviño pointed out that European funds already have a significant impact on the production fabric of the country and “this is one of the factors that explains the good progress of the Spanish economy in the context of international uncertainty”, he pointed out. He recalled that the Bank of Spain improved its growth forecast for Spain to 4.6% this year (two tenths above the executive’s forecast), which shows that the Spanish economy is on a “positive path” despite the effects of the war in Ukraine or the energy crisis.
The Vice President anticipates that the plan as a whole, including the supplement, enables GDP to grow by an average of three percentage points every year until 2031. “We are at stake,” he emphasized, after also recalling that Spain has been a leader in allocating funds within the EU from the very beginning.
Several milestones will be modified in line with other countries
On the other hand, the Government decided to include i modification of certain milestones and already built-in goals, which will have the greatest impact on investments. Government sources quoted by ‘Europa Press’ explain that this review is a consequence of a perceived delay in some investments, due to the development of the war in Ukraine, inflation, the rise in raw material prices and the resulting bottlenecks. which particularly hit sectors such as construction.
This amendment, foreseen by the Regulation on the Mechanism for Recovery and Resilience, It also takes place in almost all countries of the European Union, as explained by the Executive – the addition to the German plan, approved a few days ago, is the latest example. The Executive maintains a final execution calendar for all investments and reforms with a view to 2026, although several countries (including Spain) are considering delaying the deadlines, with respect to general execution, as there are countries that have recently approved their Recovery Plan.