The European Commission has disbursed large sums of money to several Member States under the first installment of the SURE Instrument, according to an announcement published by the Commission.
Italy has received €10 billion, Spain has received €6 billion, and Poland has received €1 billion under the SURE Instrument. After all disbursements have been made, Italy will receive a total of €27.4 billion, Spain will receive €21.3 billion, and Poland will receive €11.2 billion.
The SURE installments being made to the aforementioned countries are for the purpose of preserving employment amid COVID-19 and providing short-term jobs for citizens. The allocation of these funds is specifically geared towards helping those who are self-employed and most affected by COVID-19 related losses of employment.
“This support, in the form of loans granted on favourable terms, will assist these Member States in addressing sudden increases in public expenditure to preserve employment. Specifically, they will help cover the costs directly related to the financing of national short-time work schemes, and other similar measures they have put in place as a response to the coronavirus pandemic, in particular for the self-employed,” the announcement reads.
The SURE Instrument is paying Member States with gains from bonds purchased by investors, who have thus far shown much interest in investing in EU-sanctioned bonds. The repayment of these bonds to investors will be passed to Member States receiving the SURE funds and will be repaid from 2030-2040.
The Commission has largely pitched the purchase of SURE bonds as a way for investors to invest in the future and wellbeing of Europeans from various Member States across the Union.
“Today marks an important milestone for European solidarity as the first financing flows to our Member States: 17 billion euros to support workers in Italy, Spain and Poland. This is only the beginning. As Europe prepares to face a difficult winter, let’s remember that last week’s SURE Social Bonds issuance was more than a successful market operation – it was a huge vote of confidence in the European Union’s recovery plan and in our common economic future,” said Paulo Gentiloni, Commissioner for Economy.
The issuance of SURE bonds and disbursements of payment to Member States is also largely seen as a way to recover from the economic crisis that has had a large negative impact across Europe in all Member States. There are also expected to be more Member States receiving SURE bond funding in the future to help them recover from the COVID-19 economic crisis.
“The first disbursements under the SURE instrument are important milestones in our push to preserve jobs and livelihoods. They clearly demonstrate Europe’s solidarity with citizens in Spain, Italy and Poland affected by this unprecedented crisis. We remain committed to protecting people and jobs across Europe. SURE will play an important role in achieving this objective,” said Ursula von der Leyen, President of the European Commission.
The SURE Instrument can provide up to €100 billion in financial aid to all Member States. There are currently 17 Member States who have used the funding offered by the SURE Instrument, and €87.9 billion in aid already given to various Member States across the EU.