European Commission Resort To Fundamental Financial Aid

Forex News

The European Commission offered 2 new financial instruments with a total worth of EUR 55B (USD 64.4B) to secure reforms in the EU countries and support investments in those states with weaker economy. This project is seen as a precaution after the political tension in Italy, particularly growing anti-euro sentiment.

The plan requires acceptance from 27 EU states. It suggests that in the 2021-2027 period EUR 25B will open for countries that recover their economy from financial crisis using such reforms as pensions or labor markets. This funding will be given to all EU states, but the larger amount will be open just for 19 members of the common currency zone.

The European Investment Stabilization Function will give up to EUR 30B in loans to the EU states which stage an "asymmetric shock", such as jump in a jobless rate. This instrument won’t be accessible for Greece, Portugal and Ireland - countries that lost access to market funding.