A year after it was launched, the EU’s post-pandemic recovery fund is proving to be more of a game-changer than many in markets acknowledge.
When the Franco-German proposal to establish the fund was announced, we described this development as groundbreaking for Europe. For the first time, EU member states would issue joint liability bonds that would be funded by region-wide tax revenues, with the proceeds distributed by both grants and loans and skewed towards where it was needed most.
With the ratification process nearing completion, we are on track for the fund to formally launch in the next couple of months. However, at first glance, it is hard to argue that this new programme has generated much enthusiasm for the region from global investors.