The EU’s executive Commission in July approved 191.5 billion euros in virus recovery funds for Italy. The bloc’s third biggest economy was hardest hit by coronavirus, both in terms of economic impact and number of deaths, and will therefore receive the largest share of the 750 billion euro recovery pot.
Following a historic decision to combine debt, European Commission chief Ursula von der Leyen is currently touring the EU to officially launch the recovery fund.
The first batch of Italy’s funding, valued at almost 25 billion euros, could arrive as early as next month.
The two leaders held a press conference at the legendary Cinecitta film studios in Rome, which will receive 300 million euros from the EU funds.
One of the largest studios in Europe, it was often referred to as “Hollywood on the Tiber” in the 50s for regularly showing US blockbusters. It was also a second home to the legendary filmmaker Federico Fellini.
Prime Minister Mario Draghi assured attendees of the joint press conference that the money will be spent wisely, with reforms to Italy’s justice system to be introduced posthaste.
According to von der Leyen, these key reforms include reducing the length of both civil and criminal trials, changes to competition law and modernising the administration.
Draghi’s recovery plan involves support for young people, digital investments and climate goals. One quarter will finance improvements in digitisation, while more than a third will go towards a greener economy.
Italy’s central bank has forecasted a growth of almost five percent in the country’s economy this year, despite a staggering loss of 8.9 percent in 2020.
Public debt is also expected to climb to as much as 159.8 percent of GDP by the end of 2021, second only to Greece in the eurozone.
Draghi made reference to other EU funding Italy had received in the past, when the country only spent a fraction of the allocated amount.
The PM said that some of the new programs could become permanent if the funds are used efficiently.
The funding includes 68.9 billion euros in grants and 122.6 billion in loans.