On Wednesday 16 July, the European Commission confirmed that it wanted to group most of its economic priorities under the second “competitiveness” pillar of the budget. With €589.6 billion earmarked, this pillar includes the famous ‘European Competitiveness Fund’, as well as the Erasmus+, Horizon Europe, ‘Connecting Europe Facility’ and civil protection programmes. On Wednesday 16 July, the European Commission put forward this proposal for the 2028–2032 Multiannual Financial Framework (MFF) (see other news).
For Stéphane Séjourné, Executive Vice-President of the European Commission responsible for Prosperity and Industrial Strategy, this is an “unprecedented effort” at a budgetary level. “Over the last six months, the European Commission has launched a large number of initiatives to reindustrialise Europe. With this MFF, we are giving ourselves the means to achieve this”.
What is new is the ‘European Competitiveness Fund’ (ECF), which we have already outlined (see EUROPE 13677/1). With a budget of €410 billion, it comprises four “policy windows”: green transition, digitalisation, health and defence. An additional €40 billion will be provided via the Innovation Fund, which is financed by its own resources: ETS revenues.
The research framework programme, Horizon Europe, will have €175 billion of funding available to it. It is differentiated from the four windows, but is nevertheless taken into account in the ECF, as it works both in “synergy”, according to the European Commission.
Defence. As expected, the draft MFF gives pride of place to defence and space. “We are proposing €131 billion for the Defence and Space component of the Competitiveness Fund. That’s five times more than we have today. (...) This will strengthen our industrial base and our capacities”, summarised the President of the European Commission, Ursula von der Leyen, without giving any further details on the allocation of the funds.
Climate transition. According to Ursula von der Leyen, funds that directly or indirectly support the green transition should account for no less than 35% of the next MFF. In the ‘green transition’ window of the ECF, the Commission has so far earmarked €67.4 billion.
Digital. The budget earmarked for the digital transition amounts to €54.8 billion, according to Mr Séjourné.
Health. Priorities linked to health, biotechnology and, more generally, the bioeconomy are likely to be given a budget of €22.6 billion.
Interconnections. In addition to the ECF, the ‘Connecting Europe Facility’ (CEF) has also been strengthened, reaching €81.4 billion (compared to €33.71 billion previously), with a budget that has been doubled for transport and spending on energy infrastructure has been increased fivefold.
According to the Commission, the military mobility component of the CEF alone will be increased tenfold. The budget for military mobility is €1.7 billion in the current Multiannual Financial Framework.
See the draft post-2027 MFF: https://aeur.eu/f/HWW and the accompanying appendix: https://aeur.eu/f/hwx (Original version in French by Léa Marchal, Camille-Cerise Gessant and Pauline Denys)