\u00a9The law of intellectual property is prohibited in any way unlawful use\/appropriation of this article, with heavy civil and criminal penalties for the infringer.<\/em><\/p>\n\n\n\n The Agreement<\/strong><\/strong><\/p>\n\n\n\n This Agreement of European Leaders (27) is based on two parts:<\/p>\n\n\n\n 1.<\/strong> In the normal EU budget of seven years (2021-2028) or Multinational Financial Framework (MFF), with a total value of \u20ac1,1trn ($1,3trn).<\/p>\n\n\n\n 2.<\/strong> Authorization by European leaders (27) to the EU Commission to borrow from the capital markets with a total value of \u20ac750bn, which it will then repay by the end of 2058 using European resources (Next Generation EU-NGEU). <\/p>\n\n\n\n The aim is for these funds to be distributed to member countries in the form of grants and loans to recover their economies from the deep recession caused by the Covid-19 pandemic.<\/p>\n\n\n\n Of these \u20ac750bn funds, \u20ac390bn will be distributed as grants\/contributions and will not burden the government debts of EU member countries. The remaining funds will be provided in the form of loans. This fiscal package is higher than the US equivalent of $2trn.<\/p>\n\n\n\n The NGEU is worth as much as 4.7% of the EU’s annual GDP. In this way the EU manages to close the hole in its seven-year budget for the period (2021-2028) created by Britain\u2019s departure from the EU.<\/p>\n\n\n\n At the same time, the EU Commission is managing to provide strong answers to the ECB ‘s call that a strong fiscal policy should be created to generate strong growth, in conjunction with the ECB ‘s monetary policy to date – quantitative easing (QE) .<\/p>\n\n\n\n The criteria to be given the funds<\/strong><\/strong><\/p>\n\n\n\n The criteria to be used to distribute these funds to the member countries will be the size of the annual unemployment and the individual income of the inhabitants of the member countries. For example, Italy and Spain will each receive funds totaling \u20ac209bn in loans and grants, while Greece will receive \u20ac72bn, respectively.<\/p>\n\n\n\n The EU Commission will assess governments’ investment plans on the basis they propose.<\/p>\n\n\n\n The third criterion is that part of these investment projects should concern climate change and the green transition of the EU economy in general to achieve green growth. 30% of MFF and NGEU funds should be directed to this type of government investment plans.<\/p>\n\n\n\n Problems and Doubts<\/strong><\/strong><\/p>\n\n\n\n The first problem is that how this huge loan from the EU Commission will be repaid, since the governments of the member countries do not want to give\/transfer the power of taxation they hold in their member countries in Brussels.<\/p>\n\n\n\n The second problem is that from 2028 onwards funds will have to be found to repay the loan funds. Since Brussels cannot impose a common tax policy, member countries will have to return funds from their state budgets to the MFF.<\/p>\n\n\n\n There is certainly a tax on plastics, technology companies, and imports that are hostile to green growth and climate change in EU plans.<\/p>\n\n\n\n The third problem lies in the fact that the European economy is evolving worse than initial forecasts. There are member countries that are impressed with their poor economic performance, e.g. France, which is facing a 10% recession in 2020.<\/p>\n\n\n\n The fourth problem is that member countries such as Greece, which bases their GDP on industries such as tourism and services respectively, will not be able to recover easily unless the vaccine for Covid-19 is found first.<\/p>\n\n\n\n The fifth problem is how member countries will face a deep recession in the short term when the binding of funds has to be completed by the end of 2023 and the implementation of the programmes agreed to be financed should be finalised by the end of 2026. <\/p>\n\n\n\n For example, the US for similar cases is pushing for the passage of another $3trillion financial support package for the needs of the immediate future.<\/p>\n\n\n\n The sixth problem is that it will avoid granting loans and grants to countries that do not follow the liberal model of governance by downgrading the rule of law. Should rule-of-law criteria be applied to the provision of loans and grants to member countries?<\/p>\n\n\n\n Apart from all this, we should not lose sight of the transnational nature of the control of the management and disbursement of funds in favour of bureaucracy and the political nature of transaction to the detriment of the European Parliament and the European Institutions. The road is long with many problems but surely what is true is that every beginning is difficult.<\/p>\n","protected":false},"excerpt":{"rendered":" The decision of the Brussels summit is historic given that European leaders have agreed to borrow together on an unprecedented scale for historical data….<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5,860],"tags":[62,1797,449,1795,1796,710],"class_list":["post-2733","post","type-post","status-publish","format-standard","hentry","category-economic","category-fiscal-economics","tag-ecb","tag-eu-budget","tag-eu-commission","tag-mff","tag-ngeu","tag-qe"],"_links":{"self":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts\/2733","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2733"}],"version-history":[{"count":2,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts\/2733\/revisions"}],"predecessor-version":[{"id":2788,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=\/wp\/v2\/posts\/2733\/revisions\/2788"}],"wp:attachment":[{"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2733"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2733"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.liberalglobe.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2733"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Press](\"https:\/\/www.liberalglobe.com\/wp-content\/uploads\/2020\/07\/image-3.jpeg\")
Photo by the website www.ec.europa.eu <\/figcaption><\/figure><\/div>\n\n\n\n