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European Council reaches agreement on EU recovery package

Government Communications Department
Publication date 21.7.2020 8.29 | Published in English on 21.7.2020 at 14.28
Press release 497/2020

On Tuesday 21 July at its special meeting in Brussels, the European Council reached an agreement on the EU recovery package. The solution will boost the reactivation of the Member States' economies and support Europe's recovery from the effects of the coronavirus pandemic. The recovery package includes the Multiannual Financial Framework (MFF) for 2021–2027 and a recovery instrument called Next Generation EU, or NGEU.  Finland was represented at the meeting by Prime Minister Sanna Marin.

The overall amount of commitments to the seven-year Financial Framework is EUR 1,074 billion. The total amount of the non-recurrent recovery instrument will be EUR 750 billion. EUR 360 billion of this will consist of loans and EUR 390 billion will be issued in the form of grants.  The recovery instrument will remain in force until 2023. 

The Council reached an agreement after long negotiations that started on Friday 17 July. The package is a compromise that will benefit all Member States of the European Union.
Finland secured its desired outcome on several key negotiating objectives. For instance, the grant component of the recovery instrument was reduced by EUR 110 billion compared to the original proposal, which is in line with Finland's objectives. Additionally, the period of validity of the instrument was shortened. The funding allocation criteria take into account the economic impacts of the coronavirus crisis better than in the Commission’s initial proposal. 

-“The agreement we have now reached is a package meant to help get Europe back on its feet after the coronavirus crisis. It is in Finland’s interest that the entire EU recover from the crisis as soon as possible,” says Prime Minister Sanna Marin.

Finland also largely secured its negotiating objectives with regard to the Multiannual Financial Framework.  The Council agreed on a moderate ceiling for the Financial Framework. When it comes to funding for rural development, which is very important for Finland, the agreement secures a level that is even higher than the funding in the current Financial Framework period. This is also the first time that cohesion and agricultural funds do not dominate the Financial Framework budget.

The package includes two key conditions related to the rule of law and climate goals, which Prime Minister Marin considers particularly welcome aspects. The use of EU funds will be anchored to the rule of law with a mechanism that will be extended to apply to both the Financial Framework and the recovery instrument. This mechanism will protect EU funds from being used in situations where shortcomings are detected in compliance with the rule of law.  At least 30 per cent of the Multiannual Financial Framework and the recovery instrument must support climate goals, and all funding must support the objectives of the Paris Agreement.

Inquiries: Jari Luoto, Under-Secretary of State for EU Affairs, tel.  +358 50 468 5949, Matti Niemi, Special Adviser (EU Affairs), tel. +358 45 679 1717, Kare Halonen, State Secretary for EU Affairs, tel. +358 295 160 319.