The government’s decision to waive 75% of loans from the European Recovery Fund has raised eyebrows within the People’s Party. The Executive justifies this approach with the argument that financing on the markets is now cheaper than through community credits, which is why it is better to request the services provided from the Spanish government rather than through the EU to pay less interest. However, Núñez Feijoo’s formation rejects this hypothesis: he believes that instead of giving up, it would have been wise to apply for loans in 2022 and 2023, when interest rates were high and companies had difficulty finding cheap financing.
The most popular countries were, for example, Italy, which made greater use of these credits. “We had to be here like Italy when they started. It was the moment,” lamented the vice-secretary of the Hacienda del PP, Juan Bravo, today during an appearance at the party headquarters. I understand that not using this money has an opportunity cost, because it was not undertaken to increase Spain’s growth potential.
In addition, they believe that forgoing loans could have other consequences: that the government does not carry out the planned projects — it is decided that if it is possible to resort to the market to obtain capital, it decides not to carry out inversions until it is only obliged in its agreement with Brussels. And that the markets will not respond willingly to a possible demand for additional capital. “The more money we make on the market, the tighter and more expensive it is, if we ask for all this money on the market, the interest will increase, which will not be a problem,” Bravo insisted, recalling that many autonomous communities are financed by a higher interest offered by the EU.
The criticism that renounces credits is just one of the messages that Bravo, accompanied by the Deputy Secretary of Economy, Alberto Nadal, wanted to convey. Both criticize the recovery plan for having been “a wasted historic opportunity”, because socialist management was marked by delays and a lack of transformative ambition. They compare it to Plan E and joke about the idea that it has a positive impact on GDP. “The important thing is potential growth, not the one-time increase in GDP. Keynes decided that if you pay someone to dig for a day and pay to cover it, you will also increase GDP,” Nadal said.
The popular politician recalled that 1,100 million transfers from Brussels remain frozen due to non-compliance with commitments to equalize the tax on diesel and gasoline, relating to temporary workers, and the relative success in the digitalization of regional and local entities. “They all look like they’re frozen afterwards ad aeternum“, Nadal said.
The PP’s theory is that the President of the Government, Pedro Sánchez, did not use the money to modernize the productive fabric, but rather used European funds to be able to continue governing without preconceptions. Since this flood of millions of Europeans, I believe that it has become much more complicated to call elections.
According to PP calculations, which cite Eurostat as a source, Spain received 43% of allocated funds, placing it sixth in the EU in relation to glue, and spent only 19.5% between 2021 and 2024, well below 30.1% of the European average. To reach these percentages, the main opposition party adds up the total number of grants and loans.
Spain, along with Italy, is the main beneficiary of the recovery mechanism. He assigned 163 billion out of a total of 650,000. Among them, 83.2 billion euros were allocated in the form of loans, of which only 22.8 billion were requested, and the rest in the form of transfers against lost funds. According to the government, of these more than 79 billion dollars in subsidies, of which Spain received approximately 55 billion, or 69%.
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