Sunday , 21 July 2024
Home Global Economy EU recovery plan: Spain is a “guinea pig”
Global Economy

EU recovery plan: Spain is a “guinea pig”

This Real Economy episode comes from Spain, the first country to receive money from the EU recovery plan. Part of these disbursements, 2 billion euros to be precise, is earmarked for vocational training, a key sector in the fight against unemployment. Euronews reporter Guillaume Desjardins researched this topic in the Canary Islands. And in an interview with euronews reporter Naomi Lloyd, the Spanish finance minister talks about the reforms needed to receive the first tranche of 10 billion euros in aid.

Europe’s answer to Corona: the biggest economic stimulus package of all time

Europe’s response to the crisis was a historic stimulus package worth more than 800 billion euros.

Flanked by NextGenerationEU (NGEU), the temporary recovery instrument, the long-term EU budget is the largest stimulus package ever financed from the EU budget. With a total of 2.018 trillion euros at current prices, Europe should get back on its feet after Corona. It should become a greener, more digitally oriented and crisis-proof Europe.

Because of its greater flexibility, the new long-term budget is better able to respond to unforeseen needs. It not only does justice to the circumstances of today, but also to the imponderables of tomorrow.

Overview of Europe’s recovery plan

Europe is still suffering from the shock waves of the coronavirus pandemic.

The heart of the EU economic stimulus program is the recovery and resilience facility with loans and grants totaling more than 720 billion euros. They are available to EU countries to invest, create jobs and build a green and digital future.

To qualify for the funds, countries have submitted national recovery plans detailing planned reforms and public investment in key areas such as new green technologies, clean energy and transport, building renovation, faster internet and 5G, and education and training.

The Commission and Council have so far approved 22 national recovery and resilience plans.

Pioneer Spain

Spain has received the first payment from the European economic stimulus package. The southern European country is the first member state to have met the requirements to receive the much-discussed subsidies. Spain will receive almost 70 billion euros – the largest public investment plan in the country’s recent history. So far, 9 billion euros have been made available as pre-financing for emergencies, the first payment of 10 billion euros took place last December. How are these funds used? Guillaume Desjardins met people on Tenerife who are studying to find work.

On Tenerife, these funds are used, among other things, for vocational training. “The university teaches a lot of theory and little practice. The good thing about vocational training is the opportunity to do internships,” says picture and sound student Adrián Lorente García. “If the company likes the way you work and they need employees, they will take you. How do I see my future after the apprenticeship? I hope to work in an area that is related to my training. I would like to work in different live in different countries around the world, for example in America, Germany or Great Britain and work in different places.”

Training centers like this already exist, also thanks to the European Social Fund. From the ongoing economic stimulus program of 69.5 billion euros, an additional 2 billion euros will be made available for the creation of 135,000 new vocational training places throughout Spain.

“We receive funds from the European Social Fund. They cover 80% of teachers’ salaries and training courses for unemployed and employed people,” explains Jorge Rivero Antuña, director of the Cifp César Manrique. “As for the resilience mechanism, we have already received funds that will be used for tech classrooms and business start-up support. We hope to continue receiving grants in 2022 and 2023.”

Unemployment is a structural problem

Like other southern European Member States, Spain has a structural problem with unemployment, particularly among young people. Access to skills required by employers is a key element in the struggle for jobs.

Notably in the Canary Islands, where youth unemployment has risen to 52% by the end of 2021. Tourism is the most important industry in the Canary Islands, accounting for a third of jobs. However, the tremendous growth in the technology sector should mean new opportunities for tomorrow’s workers.

“Currently, people don’t have the right education for our needs – neither in the Canary Islands nor in the rest of Spain,” says Carlos Rodríguez, founder of Omnia Infosys. “People don’t have the required skills. This sector will grow strongly. There will be a lot of demand. We need more and more people with qualifications. The demand has been incredibly high since COVID-19. The growth has accelerated over the past two It has tripled or quadrupled in the past few years. And it’s only going to increase. There are millions of job vacancies in Europe in this sector. EU stimulus funds are funding new apprenticeships, but it’s not just about the money. To get the funds, Spain had to implement social reforms, like modernizing the vocational training system or closing the gender pay gap in the workplace.”

Across the EU, EU member states are working on their social reforms to get their share of the stimulus funds.

Interview with Spain’s Deputy Prime Minister

euronews reporter Naomi Lloyd talks to Spain’s Finance Minister Nadia Calviño about these reforms – and her vision for the country’s economic recovery.

Euronews reporter Naomi Lloyd: Spain will receive almost 70 billion euros. That has never happened before. What does that mean for Spain, for the Spanish economy?

Nadia Calviño, Vice President of the Spanish Government and Minister for Economy and Digitization: This is very important for Spain’s present and future, for the next generations. Our recovery plan focuses on four areas: green, digital, social and territorial cohesion, and gender equality – which is enshrined in all programs. The digital area will account for about 30 percent of the total investments.

Euronews: There will be a series of structural reforms. How difficult was it to meet all the required conditions?

Nadia Calviño: It was a very arduous and intense process. In a way, we were the guinea pigs who started the process. We have learned together with the Commission how to implement this unprecedented recovery plan. As for reforms, we accelerated them throughout 2021. The challenge now is to complete the pending procedures in Parliament and continue the flow of funds that began last year.

Euronews: Is there the administrative capacity to implement it?

Nadia Calviño: It’s a very big challenge for any administration. And Spain is a big country, a complex country. We have a multi-layered administration. We have established a governance structure and strengthened the existing mechanisms. In the coming weeks we will launch some of the most important strategic plans, such as the transition to electric and connected cars.

Euronews: What do you think the impact of vocational training projects like the one in our report is – how big is the impact on unemployment?

Nadia Calviño: Vocational training is one of the keys to making the job market work better in the future. Our unemployment rate has fallen to 13.3. Together with the structural reforms, especially the labor market reform, and the significant investments in education, vocational training and lifelong learning, Spain can finally eliminate some of the imbalances that have been holding back growth and prosperity for decades.

Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Articles

Global Economy

Spotlight on 2023: S&P 500 and the Significance of the 4400 Level

In our past exploration of the financial landscape of 2023, we delved...

Global Economy

AI and Data Analytics Drive Efficiency in Money Laundering Detection

BIS Innovation Hub Turns to Tech for Money Laundering Detection The BIS...

Global Economy

Russell 2000 Gains Momentum as Tech Stocks Outperform Value

Tech stocks have dominated the equity markets in recent months, surpassing value...

Global Economy

Crypto Exchange Bybit Announces Exit from Canadian Market Amid Regulatory Changes

Regulatory Shifts Prompt Bybit's Strategic Withdrawal from Canadian Crypto Market