| 1 October 2022, Saturday |

EU recovery fund could be repurposed over Ukraine, German finance minister says

According to German Finance Minister Christian Lindner, the European Union recovery fund established to assist the bloc in recovering from the COVID-19 pandemic could be repurposed in light of the war in Ukraine.

“In light of the changed situation,” Lindner told the Frankfurter Allgemeine Sonntagszeitung, “I’m open to prioritizing the available funds.”

The minister who leads the pro-business Free Democrats (FDP) added that “investments in infrastructure, energy, and competitiveness are needed, not more state consumption and postponed reforms.”

In an unprecedented move to prevent economic fragmentation due to the pandemic, EU countries agreed in 2020 to jointly borrow 800 billion euros ($878 billion) to spend on rebuilding their economies to be greener and more digitized.

The EU will discuss in a few weeks whether it needs to jointly borrow more money in response to the challenges created by Russia’s invasion of Ukraine, European Economic Commissioner Paolo Gentiloni said on Tuesday.

France is leading calls for new EU debt, while Germany, the Netherlands, Austria and other countries oppose such new borrowing now, arguing that the economic impact of the war in Ukraine is still unclear and that only 74 billion euros of the fund has been disbursed so far.

  • Reuters