European funds
Business 31/07/2021

State to distribute 10.5 billion of European funds to the communities by 2021

They are part of the 19,034 million that the Spanish government expects to receive from Brussels before the end of the year

2 min
Spanish Prime Minister Pedro Sanchez this week.

MadridThe numbers of European remittances that are due to arrive in Spain are becoming clearer as the days go by. This Friday, the president of the government, Pedro Sánchez, has confirmed that he will distribute 10,500 million in European funds among the autonomous communities before the end of the year, that is, half of the total 19,034 million that the government plans to receive this 2021, as confirmed by the Moncloa. In fact, this was the commitment that Sánchez made to the conference of presidents in October last year with the regional governments and which he confirmed yesterday, Friday. From this Monday on, the Spanish government will begin to study with the communities how it will distribute this money. A debate that is not easy because it is closely linked to the projects promoted by each community and, therefore, must go hand in hand with the technical criteria agreed by the member states when it comes to funding initiatives.

Finally, according to the calculations of Sánchez's government, Spain will receive a lower figure than the 24,197 million budgeted by the government. This is not a problem because Brussels issues debt so that states can count on the money regardless of its delivery. Since Ecofin gave the go-ahead to the anti-pandemic funds for Spain on 13 July, the government has already received 9 billion and was counting on a further 10 billion to arrive before the end of the year, as the Spanish recovery plan itself foresees. It has finally confirmed that the money will arrive and that it will therefore have a total of 19.034 billion at its disposal. 10.5 billion of this total amount will be transferred to the autonomous communities (55%).

However, the Spanish government has to meet the commitments agreed with Brussels - including labour reform - so that the 10,000 million pending will be released. Even so, the confidence of the Moncloa is high and sources of the Economy ministry explained to ARA that they are convinced that there will be no obstacles. Moreover, in Brussels they also expect this to be simple: "It is true that Spain has made many efforts in early investments, so it is certainly very likely to receive the next 10,000 million this year", confirmed the executive vice president of the European Commission, Valdis Dombrovskis.

Direct aid and loans

This 19.034 billion is part of the Recovery and Resilience Mechanism. But the state has also received money from one of the other legs of European funding, the React EU funds. From here, too, 8,000 million have been transferred to the communities in 2021. This money is added to the additional fund of 13,486 million euros that the Treasury has distributed among the communities. Of these, 2,160 million will be for Catalonia, according to calculations by the Generalitat.

Spain will receive 69,500 million euros in direct aid from European funds and the rest, up to 140,000, will be received in loans to be repaid before 2026. This figure makes the state one of the main beneficiaries, behind Italy. Even so, it has so far only applied for subsidies.

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