This morning @EUCouncil agree on historic 3y spending to kickstart the economy (750Bn€, w/ 390Bn grants & 360Bn loans) + 7y #EUbudget to invest in the long term (1.074Bn€). Before @Europarl_EN decides on this deal, let's see what’s in it: the good, the bad and the ugly. #Thread
Good n°1: Good news: there is a deal, and we are in July. I personally did not expect them to find an agreement before the fall, so having a deal in mid-July is already a positive piece of news in itself.
Good n°2: The overall architecture has not changed. Yes, less money will be invested than what was originally proposed (more👇), but we still get a reasonably sized budget (1.074bn€ over next 7y) + significant input of fresh money (390Bn€ in grants) that is good for #recovery
Good n°3: 390Bn€ in grants over the next three years (2021, 2022 and 2023) is a sizable stimulus. It is obviously not a silver bullet, but it is sizable (around 3% of the EU-27 GDP).
Good n°4: big promise to ensure that 30% of all that money (i.e. 550Bn€ of the overall 1.826 Bn€) will be invested in #climate. With the development of a sound methodology to analyse what is & isn't ‘climate spending’ (spoiler: discerning this is harder than you may think)
Good n°5: big promise that zero cent will go to projects that would harm the #environment ( #DoNoHarm principle)
Good n°6: this new 390Bn€ of EU debt will be reimbursed in the future, incl. through mechanisms that will ask for polluters to pay more, esp. on non-recycled plastics, #aviation, maritime sector, as well as a mechanism ( #CBAM) to ensure that imported goods pay their fair share
Bad n°1: invest less in future.
Before #COVID we planned to invest 83,5Bn€ in #Research #Innovation (R&I).
After COVID we invest LESS: 80,9Bn€.
Is it selfish, shortsighted or stupid to invest less in R&I after COVID? How much COVID research will NOT be supported as a result?
Bad n°1 (extended): Btw, other forward-looking programs, including the EU space program and the EU digital program are also significantly cut.
Bad n°2: the 26Bn€ program to recapitalize EU companies (known as Solvency Support Instrument) has disappeared. 👉 big risks that companies, incl. clean economy companies & #StartUp will not have sufficient access to capital and might be bought by US/Russian/Chinese/Saudi money.
Bad n°3: “There shall be no mid-term review of the MFF”. So fingers crossed🤞 that in the next 7years, there will be no significant crisis requiring a change in the #MFF. No 2nd wave of COVID, no economic crisis, no climate catastrophes, no migration crisis, no new pandemic, etc.
Bad n°4: the #JustTransition Mechanism is severely cut, from 40Bn (10 + 30) to 17,5Bn (7,5 +10). That reduces the EU capacity to ensure that the transition is done in a socially-fair manner, i.e. doing the #GreenTransition the only way that is politically feasible in a democracy.
Ugly n°1: no indication of means to ensure that ‘30% for climate’ & ‘0 for pollution’ promises will materialize. Language is weak. Key pro-climate programmes are cut. Appeals for more flexibility increase risks of EU money going to polluting projects or corruption (or both).
Ugly n°2: 🇦🇹🇩🇪🇩🇰🇳🇱🇸🇪 will contribute less to the 🇪🇺Budget. That's 7,5Bn€ that 🇧🇬🇷🇴🇫🇷🇮🇹 and others will have to pay to compensate rich countries' preferential treatment. Morally wrong, democratically disastrous, but politically necessary to avoid @sebastiankurz @markrutte veto
Ugly n°3: dutch budget will capture lot of 💰meant for 🇪🇺. Rotterdam is EU’s biggest port. So dutch customs collect many 🇪🇺trade tariffs. To cover the collection costs it wld make sense for 🇳🇱 to keep 5-10% of the amounts collected, but @markrutte negotiated 25%. #FreeLunch
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