'Bold and visionary': MEPs demand 'massive' €2tr EU green recovery package

MEPs have called on the European Commission deliver a "massive" €2tr coronavirus recovery fund next week that prioritises the proposed Green Deal agenda to transform Europe into the world's first net zero continent by 2050.

In a resolution that secured strong backing from MEPs on Friday with 505 votes in favour and 119 against, the European Parliament demanded the EU revise its post-2020 budget in the wake of Covid-19, and said economic recovery plans must have a strong social and environmental focus.

It insists the Commission's forthcoming 'transformation and recovery fund' must be of $2tr in size, with investments directed to projects that comply with Europe's 2050 net zero and biodiversity ambitions, as well as the Paris Agreement and the UN Sustainable Development Goals (SDGs).

Arguing that EU citizens "must be at the heart of the recovery strategy", the resolution also calls for the recovery package to help fight against tax evasion and tax avoidance, and urges the Commission to ensure State Aid guidelines are compatible with these green and social conditions.

The resolution calls for the "massive recovery package to transform our economies and strengthen their resilience", through investments that support small and medium businesses, and boosts jobs and skills. It "calls therefore for investments to be prioritised into the Green Deal" and the digital agenda.

Lawmakers also insisted the Commission should avoid resorting to "financial wizardry" to give a misleading impression of the size of the package, arguing the €2tr sum should be financed through issuance of long-dated recovery bonds and "disbursed through loans and, mostly, through grants and direct payments for investment and equity".

Today's vote from MEPs is a major win for proponents of a green recovery to the economic crisis currently engulfing much of the world as a result of the ongoing pandemic, and heaps greater pressure on the EU Commission to come up with a recovery package in line with its Green Deal agenda next week.

In the UK, meanwhile, the Prime Minister Boris Johnson on Wednesday also suggested the government's recovery efforts should prioritise low carbon infrastructure investments.

Markus Trilling, finance and subsidies policy coordinator at Climate Action Network (CAN) Europe - a coalition of hundreds of green groups and NGOs across 38 countries - said the EU Parliament's resolution today "sends a clear message to the Commission"

"Even in the name of urgency taxpayer's money must not be burnt on outdated, polluting, and carbon-intensive projects," he said. "EU funds worth hundreds of billions have to be future-proof and invested in renewable energy, energy efficiency and the modernisation of all economic sectors to reach climate neutrality."

The resolution adopted today echoes growing calls from rafts of investors, businesses, green groups and citizens for a green recovery, said Luca Bonaccorsi, director of sustainable finance at Transport & Environment.

"The Parliament heard loud and clear that Europeans want a green and just recovery, not unconditional aid to polluting industries," he said. "The resolution is bold in magnitude and visionary in content and it prefigures a new, stronger, greener and more cohesive union. President Ursula von der Leyen now has the backing she needs to resist polluting industry lobbies and deliver the biggest green investment plan the world has ever seen."

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