FINANCE

Greece a champion in absorbing EU funds

Athens has requested and is efficiently absorbing EU funds amounting to some 6.1% of its GDP

Greece a champion in absorbing EU funds

Greece has not only secured the most funds among European Union countries from the Recovery and Resilience Fund as a percentage of its GDP – i.e. 30.5 billion euros or 16.7% of GDP – but it has so far absorbed the most – €11.1 billion or some 6.1% of its GDP – according to the relevant European Commission performance table.

In the recent text of the Commission’s Recommendations to the Member-States, published in the context of the European Semester, the comments on the performance of the member-states in the utilization of the Recovery Fund capture the qualitative picture. Therefore, while Germany, for example, which has so far not submitted any installment payment requests, is reprimanded for “significant delays” and asked to “significantly speed up,” Greece – having submitted three payment requests – is considered to be “progressing well” and is called on to “maintain the momentum of the application in the future.”

Greece, Brussels notes, is off to a strong start in implementing its plan and has set up a management and control system to monitor and coordinate the timely completion of reforms and investments. It is important to maintain and strengthen these efforts in the future.

In contrast, for Germany it is noted that it has devoted minimal resources to the implementation of the plan and has not given it priority. The variation is to some extent explained by the relative importance of the program for each country. While for Greece the fund’s resources correspond to 6.1% of its GDP, for Germany, which has received €26.4 billion, they correspond to only 0.7% of its GDP. In addition, Greece has an investment gap of €100 billion to cover, a “legacy” of the bailout period.

However, the Commission also addresses an important warning to Greece: The plan, it notes, is reaching a point where it will depend more and more on regional and local authorities, which have administrative and implementation weaknesses. That is why coordination with and assistance to these authorities will be required of the next government in order to implement the plan, which includes a series of public tenders.

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