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NextGenerationEU: €93 million recovery and resilience plan in line for Luxembourg

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The European Commission has today (18 June) adopted a positive assessment of Luxembourg's recovery and resilience plan. This is an important step towards the EU disbursing €93 million in grants under the Recovery and Resilience Facility (RRF). This financing will support the implementation of the investment and reform measures outlined in Luxembourg's recovery and resilience plan. It will support Luxembourg's efforts to emerge stronger from the COVID-19 pandemic.

The RRF – at the heart of NextGenerationEU – will provide up to €672.5 billion (in current prices) to support investments and reforms across the EU. The Luxembourgish plan forms part of an unprecedented coordinated EU response to the COVID-19 crisis, to address common European challenges by embracing the green and digital transitions, to strengthen economic and social resilience and the cohesion of the Single Market.

Commission President Ursula von der Leyen said: “Today, the European Commission has decided to give its green light to Luxembourg's recovery and resilience plan. The plan places a strong emphasis on measures that will help secure the green transition, demonstrating Luxembourg's commitment to creating a more sustainable future. I am proud that NextGenerationEU will play an important role in supporting these efforts.”

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The Commission assessed Luxembourg's plan based on the criteria set out in the RRF Regulation. The Commission's assessment considered in particular whether the investments and reforms set out in Luxembourg's plan support the green and digital transitions; contribute to effectively addressing challenges identified in the European Semester; and strengthen its growth potential, job creation and economic and social resilience.

Securing Luxembourg's green and digital transition  

The Commission's assessment finds that Luxembourg's plan allocates 61% of total expenditure to measures that support climate objectives. This includes measures to supply renewable energy to a housing district project in Neischmelz, a support scheme for the deployment of charging points for electric vehicles, and the “Naturpakt” scheme encouraging municipalities to protect the natural environment and biodiversity.

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The Commission finds that Luxembourg's plan devotes 32% of total expenditure to measures that support the digital transition. This includes investments in the digitalisation of public services and procedures; digitalisation of projects for healthcare, such as an online solution for remote healthcare checks; and the establishment of a laboratory for testing ultra-secure communication connections based on quantum technology. In addition, investments in targeted training programmes will provide job seekers and workers on short-time work schemes with digital skills.

Reinforcing Luxembourg's economic and social resilience

The Commission considers that Luxembourg's plan is expected to contribute to effectively addressing all or a significant subset of challenges identified in the relevant country-specific recommendations (CSRs). Specifically, it contributes to addressing CSRs on  labour market policies through addressing skills mismatches and enhancing the employability of older workers. It also contributes to increasing the resilience of the healthcare system, increasing available housing, the green and digital transitions, and the enforcement of the anti-money laundering framework.

The plan represents a comprehensive and adequately balanced response to Luxembourg's economic and social situation, thereby contributing appropriately to all six pillars of the RRF Regulation.

Supporting flagship investment and reform projects

Luxembourg's plan proposes projects in five European flagship areas. These are specific investment projects dealing with issues that are common to all Member States in areas that create jobs and growth and are needed for the green and digital transitions. For instance, Luxembourg has proposed measures aimed at increasing the effectiveness and efficiency of public administration service through enhanced digitalization.

An Economy that Works for People Executive Vice President Valdis Dombrovskis said: “Congratulations to Luxembourg for designing a recovery plan whose focus on the green and digital transitions goes way beyond the minimum requirements. This will make a significant contribution to Luxembourg's recovery from the crisis, promising a brighter future for its young people by investing in digital skills programmes, training for jobseekers and the unemployed, as well as increasing the supply of affordable and sustainable housing. These investments will make Luxembourg's economy fit for the next generation. It is also good to see Luxembourg's plans to invest in renewable energy and further digitalize its public services – both areas with potential for solid economic growth.”

The assessment also finds that none of the measures included in the plan significantly harm the environment, in line with the requirements laid out in the RRF Regulation.

The control systems put in place by Luxembourg are considered adequate to protect the financial interests of the Union. The plan provides sufficient details on how national authorities will prevent, detect and correct instances of conflict of interest, corruption and fraud relating to the use of funds.

Economy Commissioner Paolo Gentiloni said: “Although its financial contribution is relatively limited in size, Luxembourg's recovery and resilience plan is set to deliver real improvements in a number of areas. Particularly positive is the strong focus on supporting the Grand Duchy's climate transition, with important measures to encourage the take-up of electric vehicles and increase energy efficiency in buildings. Citizens will also benefit from the drive to boost digital public services and provide more affordable housing. Lastly, I welcome the fact that the plan includes significant steps to further reinforce the anti-money laundering framework and its enforcement."

Next steps

The Commission has today adopted a proposal for a Council Implementing Decision to provide €93m in grants to Luxembourg under the RRF. The Council will now have, as a rule, four weeks to adopt the Commission's proposal.

The Council's approval of the plan would allow for the disbursement of €12m to Luxembourg in pre-financing. This represents 13% of the total allocated amount for Luxembourg.

The Commission will authorize further disbursements based on the satisfactory fulfilment of the milestones and targets outlined in the Council Implementing Decision, reflecting progress on the implementation of the investments and reforms. 

More information

Questions and Answers: European Commission endorses Luxembourg's €93m recovery and resilience plan

Recovery and Resilience Facility: Questions and Answers

Factsheet on Luxembourg's recovery and resilience plan

Proposal for a Council Implementing Decision on the approval of the assessment of the recovery and resilience plan for Luxembourg

Annex to the Proposal for a Council Implementing Decision on the approval of the assessment of the recovery and resilience plan for Luxembourg

Staff-working document accompanying the proposal for a Council Implementing Decision

Recovery and Resilience Facility

Recovery and Resilience Facility Regulation

European Commission

NextGenerationEU: European Commission disburses €231 million in pre-financing to Slovenia

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The European Commission has disbursed €231 million to Slovenia in pre-financing, equivalent to 13% of the country's grant allocation under the Recovery and Resilience Facility (RRF). The pre-financing payment will help to kick-start the implementation of the crucial investment and reform measures outlined in Slovenia's recovery and resilience plan. The Commission will authorise further disbursements based on the implementation of the investments and reforms outlined in Slovenia's recovery and resilience plan.

The country is set to receive €2.5 billion in total, consisting of €1.8bn in grants and €705m in loans, over the lifetime of its plan. Today's disbursement follows the recent successful implementation of the first borrowing operations under NextGenerationEU. By the end of the year, the Commission intends to raise up to a total of €80 billion in long-term funding, to be complemented by short-term EU-Bills, to fund the first planned disbursements to member states under NextGenerationEU.

The RRF is at the heart of NextGenerationEU which will provide €800bn (in current prices) to support investments and reforms across member states. The Slovenian plan is part of the unprecedented EU response to emerge stronger from the COVID-19 crisis, fostering the green and digital transitions and strengthening resilience and cohesion in our societies. A press release is available online.

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Cyprus

NextGenerationEU: European Commission disburses €157 million in pre-financing to Cyprus

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The European Commission has disbursed €157 million to Cyprus in pre-financing, equivalent to 13% of the country's financial allocation under the Recovery and Resilience Facility (RRF). The pre-financing payment will help to kick-start the implementation of the crucial investment and reform measures outlined in Cyprus' recovery and resilience plan. The Commission will authorise further disbursements based on the implementation of the investments and reforms outlined in Cyprus' recovery and resilience plan.

The country is set to receive €1.2 billion in total over the lifetime of its plan, with €1 billion provided in grants and €200m in loans. Today's disbursement follows the recent successful implementation of the first borrowing operations under NextGenerationEU. By the end of the year, the Commission intends to raise up to a total of €80bn in long-term funding, to be complemented by short-term EU-Bills, to fund the first planned disbursements to member states under NextGenerationEU. Part of NextGenerationEU, the RRF will provide €723.8bn (in current prices) to support investments and reforms across member states.

The Cypriot plan is part of the unprecedented EU response to emerge stronger from the COVID-19 crisis, fostering the green and digital transitions and strengthening resilience and cohesion in our societies. A press release is available online.

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Belgium

EU Cohesion policy: Belgium, Germany, Spain and Italy receive €373 million to support health and social services, SMEs and social inclusion

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The Commission has granted €373 million to five European Social Fund (ESF) and European Regional Development Fund (ERDF) operational programmes (OPs) in Belgium, Germany, Spain and Italy to help the countries with coronavirus emergency response and repair in the framework of REACT-EU. In Belgium, the modification of the Wallonia OP will make available an additional €64.8m for the acquisition of medical equipment for health services and innovation.

The funds will support small and medium-sized businesses (SMEs) in developing e-commerce, cybersecurity, websites and online stores, as well as the regional green economy through energy efficiency, protection of the environment, development of smart cities and low-carbon public infrastructures. In Germany, in the Federal State of Hessen, €55.4m will support health-related research infrastructure, diagnostic capacity and innovation in universities and other research institutions as well as research, development and innovation investments in the fields of climate and sustainable development. This amendment will also provide support to SMEs and funds for start-ups through an investment fund.

In Sachsen-Anhalt, €75.7m will facilitate cooperation of SMEs and institutions in research, development and innovation, and provide investments and working capital for micro-enterprises affected by the coronavirus crisis. Moreover, the funds will allow investments in the energy efficiency of enterprises, support digital innovation in SMEs and acquiring digital equipment for schools and cultural institutions. In Italy, the national OP ‘Social Inclusion' will receive €90m to promote the social integration of people experiencing severe material deprivation, homelessness or extreme marginalisation, through ‘Housing First' services that combine the provision of immediate housing with enabling social and employment services.

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In Spain, €87m will be added to the ESF OP for Castilla y León to support the self-employed and workers who had their contracts suspended or reduced due to the crisis. The money will also help hard-hit companies avoid layoffs, especially in the tourism sector. Finally, the funds are needed to allow essential social services to continue in a safe way and to ensure educational continuity throughout the pandemic by hiring additional staff.

REACT-EU is part of NextGenerationEU and provides €50.6bn additional funding (in current prices) to Cohesion policy programmes over the course of 2021 and 2022. Measures focus on supporting labour market resilience, jobs, SMEs and low-income families, as well as setting future-proof foundations for the green and digital transitions and a sustainable socio-economic recovery.

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