European recovery plan: France received 5.1 billion euros

France received on Thursday (19/8) the first payment of the European recovery plan. Amounting to 5.1 billion euros. Minister of the Economy Bruno Le Maire announced on Wednesday (18/8) in the daily Sud Ouest.

“This Thursday, we will receive 5.1 billion euros in subsidies from the European support plan”, said the Minister of the Economy in an interview with the daily Sud Ouest. He welcomed that almost half of the French recovery plan of 100 billion euros is already committed. Adding that 70 billion will be at the end of the year. This plan will be subsidized to the tune of 39.4 billion euros until 2026 by the European Commission, which approved the French recovery plan in June. A second payment of 5 billion euros should be made in the fall.

This European aid is financed for the first time by debt raised jointly, for a total amount at Community level of around 750 billion euros, in the form of grants and loans, fiercely negotiated within the framework plan entitled “NextGenerationEU”. On Tuesday, Spain, Belgium, Luxembourg and Portugal also received initial funding, up to 9 billion euros for Spain.

Thanks to the recovery plan, France should return to its pre-crisis level of activity from the end of 2021, according to Bruno Le Maire. This horizon is also that foreseen by INSEE since the beginning of July. The minister is due to visit an SME in Bayonne on Thursday that is benefiting from the recovery plan. Akira Technologies designs and manufactures testing machines used in particular in aeronautics and automobiles. Its investment project will enable it to create a new workshop for critical components, explains Bercy in a press release.

The economy “at 99%” of its capacity

Almost half of the European aid received by France will be dedicated to the ecological transition. With 5.8 billion euros for the energy renovation of buildings, 4.4 billion to modernize the rail network, and 1.9 billion for develop carbon-free hydrogen. A little more than 8 billion euros will be devoted to the digitization of companies, schools and administrations. While the rest of the envelope must finance, in particular, expenditure in favor of employment and the learning of young people, modernization of the health system and vocational training programs.

Bruno Le Maire said he was confident for the coming months. Because the French economy is now running at 99% of its capacity compared to 2019. He wants proof that for the first week of August 2021, credit card purchases are 17% higher than the same week of 2019. Even if this week preceded the implementation of the health pass, which could slow down the consumption. On August 30, the minister will organize a meeting in Bercy with representatives of professional organizations. Some of which are asking for the extension of aid to companies which expire at the end of August. Bruno Le Maire warns that in normal cruising speed, the State does not have vocation to lead the economy. He assures that they will continue to support those who need it.