The European Commission plans to borrow around 150 billion euros annually until 2026 to finance the bloc’s unprecedented plan to make its economy greener and more digitalised the Commission said on Wednesday.The amount of the EU economic plan was agreed at 750 billion euros in 2018 prices, but now totals around 807 billion euros in current prices.

The money is split into 338 billion euros in grants and 386 billion in loans for the 27 EU countries and the rest is for joint EU programmes. It will be distributed over the next five years with a third to be spent on reducing CO2 emissions in the EU’s 27 economies.

Each of the 27 EU governments can get 13% of its share of the money this year in pre-financing before projects paid for by the scheme reach agreed milestones and targets. The EU will publish a funding plan six months in advance to allow investors to plan.

“Our structures will be ready by June and theoretically we could start borrowing then, but it depends on how quickly member states complete the ratification process,” Han told a news conference.

The repayment of the borrowing is supposed to come from new taxes the EU is to agree on over the coming years, rather than from national budgets. The repayment is to start in 2028 and continue until 2058. The EU also plans a financial transaction tax and a financial contribution linked to the corporate sector or a new common corporate tax base. Reuters

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