The European Union’s Recovery and Resilience fund will give Greece 7.5 billion euros ($9.1 billion) in 2021, which is almost double the amount Greece initially expected to receive.
Alex Patelis, the chief economic adviser to Prime Minister Kyriakos Mitsotakis gave a statement at the Athens Stock Exchange’s annual investment forum announcing the increase: “We now expect some 7.5 billion euros, up from an initial 4 billion euros.”
Greece plans on using the funds to aid in its recovery from the COVID-19 pandemic as well as the lingering effects of the debt crisis. This aid is part of a six year national recovery plan that Greece submitted to the EU, known as ‘Greece 2.0.’ The amount that has been doubled is the first year of funding.
The evolution of Greece’s national recovery plan
Greece formally submitted the ‘Greece 2.0’ national recovery plan to the European Union this past April.
Athens is to receive approximately 30 billion euros from the European Union’s 750-billion-euro Recovery and Resilience Facility (RRF) and expects another 27 billion euros from inexpensive loans and investors over the next six years.
The EU Recovery and Resilience Fund is meant to help repair the economic and social damage caused by the coronavirus pandemic, and lay the foundations for a modern and more sustainable Europe.
The EU’s long-term budget, coupled with NextGenerationEU, the temporary instrument designed to boost the recovery, will be the largest stimulus package ever financed through the European Union.
On December 17, 2020 it was decided that a total of €1.8 trillion will be used to help rebuild a post-COVID-19 Europe. Part of the package calls for creating a greener, more digital and more resilient Europe as well.
The Greek Recovery Plan consists of four pillars: Green, Digital, Social, and Economic and Institutional reform.
1. Green transition. The investments of the Greek Recovery Plan include, inter alia:
– Extensive program “savings” for households, businesses, public buildings and infrastructure.
– The interconnection of the Greek islands, which will significantly reduce the energy costs of households and businesses and energy storage investments that will allow the best utilization of the country’s potential in renewable energy sources.
– Promotion of strategic urban actions for development of their environmental value.
– Large investments in flood control projects, accompanied by changes in the use of irrigation networks and installation of telemeters for leak detection and smart water management.
– A new National Reforestation Plan.
– Initiatives to protect biodiversity.
– Large investments in infrastructure and equipment of the Civil Protection authority.
– Investments for the elaboration of urban plans that will inform validly and immediately regarding land use for 4/5 of the country.
2. Digital transition. The investments of the Plan include, inter alia:
– Pre-installation of fiber optic infrastructure in buildings to facilitate the transition to the use of fiber optic networks by businesses and households.
– Development of 5G network corridors on Greek highways.
– Connection of the mainland with modern underwater fiber optic cables with the Greek islands.
– Digitization of key files in various sectors (health, justice, town planning, land registry, immigration, etc.) and their integration into respective information systems.
– Ensuring the interconnection and interoperability of systems and individual registers and individual applications between public bodies.
– Information system for the management of transactions of the Public Administration with the citizens and businesses.
– Investments to battle tax evasion, which include further digitization of tax services, codification and modernization of tax legislation, actions against smuggling and the use of artificial intelligence to facilitate tax audits, enhance electronic transactions, etc.
– Digital transformation of companies, with the acquisition of equipment, cloud services and internet services, such as new electronic payment technologies, electronic invoicing, remote work, digital office, etc.
3. Private investment and economic reform. The Plan includes, inter alia:
– Strong incentives for private investment (green, digital transformation, innovation, extroversion).
– Important infrastructure projects such as the northern part of the E65, the Northern Road Axis of Crete, a major road safety project, major irrigation projects through PPPs, the modernization also through PPPs of the railway network, a new suburban railway in Western Attica, tolls, “smart” infrastructure, etc.
– Investments for the strengthening of culture, such as the creation of the Museum of Underwater Antiquities in Piraeus, development of cultural and natural routes and a program for the protection of emblematic monuments from climate change, etc.
– Investment in tourism with interventions for mountain tourism, health tourism and the use of thermal springs, gastronomy, upgrading of tourist ports, diving tourism, access to beaches and special training programs to upgrade the skills of the human resources of tourism business.
4. Social cohesion and employment. The plan also includes, inter alia:
– Employment programs aimed at increasing employment with particular emphasis on the development of digital skills and digital transformation of education.
– Development of digital infrastructure in classrooms and interactive learning.
– Upgraded equipment in laboratories and research centers.
– Vouchers for purchasing computers and tablets for vulnerable households so children can familiarize themselves with digital tools.