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European Commission - Press release
Commission welcomes the top up of co‑financing rates for Europe's struggling economies
Brussels, 01 December 2011 – Today, the Commission's proposal (IP/11/942) to provide supplementary EU co‑financing to countries facing particular difficulties in managing public debt/deficit and ensuring financial stability was agreed by the European Parliament. The agreement follows only 4 months after the Commission proposal was tabled as part of the package adopted on 1 August to increase the EU co‑financing in cohesion, fisheries and rural development policies for countries that have received financial assistance under the balance of payments support mechanism (Romania, Latvia and Hungary) or under the European Financial Stability Facility (Greece, Ireland and Portugal). The agreement by the Council, which will complete the adoption process, is expected to take place soon.
Commenting on the swift adoption, President of the European Commission, José Manuel Barroso said: "Today we have taken an important step on the path to European recovery. I am glad that the Parliament acted so quickly and agreed to our proposal. This measure is Europe's expression of solidarity with and support for Member States implementing painful economic adjustment programmes. They currently do not have much space for investing in growth and jobs. Our measure will inject into those economies funding essential for boosting their competitiveness and employment. "
The measure does not represent new or additional funding for the six Member States in question. It does however allow an earlier reimbursement of available funds under cohesion policy, rural development and fisheries. The EU investment in the countries most affected by the economic crisis can be increased by up to 10 percentage points, meaning that the EU could cover up to a maximum of 95% of programme costs, if requested by the Member States concerned. Reduction of national match-funding for EU projects in theses countries at a crucial time of budgetary consolidation will make possible that many growth-enhancing projects, such setting up business clusters or investing in transport infrastructure, actually get off the ground. In this way level of execution can be increased, absorption augmented and extra money injected into the economy faster.
Financial Assistance Mechanisms
Balance of Payments (BoP) mechanism for non-Euro countries
European Financial Stabilisation Mechanism (EFSM) for Eurozone countries