Mid-term revision of the EU’s long term budget for 2021-2027

Two aspects of the revision are of particular importance for the EU’s funding operations. The first is the agreement to launch the Ukraine Facility, a new programme under which the EU will provide €50 billion in support to Ukraine between 2024 and 2027. Of this total, €33 billion will come in the form of loans financed by EU-Bonds issued under the unified funding approach. More information on this new programme is available in a dedicated article in this newsletter.

Another important aspect of the revision is the introduction of a new budgetary tool, the “EURI instrument”, which will support the repayment of bonds issued to finance NextGenerationEU. The funds mobilised under NGEU are used to provide loans and grants (also known as non-repayable support) to Member States under a number of different programmes, most notably the Recovery and Resilience Facility. While loans are repaid by beneficiary Member States, future EU budgets will repay the part of the borrowing used for grants. The new “EURI instrument” reinforces the existing budgetary allocations for debt service payments related to the grants. This provides additional assurance that sufficient budgetary resources will be available to cover all interest cost incurred by the EU budget.