MADRID (Reuters) – Spain outlined its Recovery and Resilience plan on Tuesday aiming to revive and modernise its economy after a record 10.8% contraction in 2020, using 72 billion euros ($85.87 billion) in European grants it is due to receive by 2023.
As one of the countries hardest hit by the pandemic, Spain should have a total of 140 billion euros including EU loans to spend by 2027 for an investment and reform programme closely monitored by the European Commission.
Envisaging a total of 110 large investment projects, the plan is organised into 10 policy areas, and involves 102 planned reforms, notably of the pension system and labour market. The programme should add two percentage points to gross domestic product growth annually in the coming years.
GREEN AND DIGITALISED ECONOMY
Green investment accounts for 39% of the plan, the largest portion, followed by digitalisation projects, accounting for a third of the total and aimed at helping small companies, public administration and key sectors such as tourism.
EDUCATION
Education will absorb at least 18% of the 72 billion euros, creating 65,000 places in pre-school education and 140,000 school classrooms due to open. Boosting science and technology will take up 3.3 billion euros.
RURAL AND URBAN AGENDA
Broadband internet and 5G mobile networks will be brought to rural areas in a 4.3 billion euro plan. Avoiding depopulation and attracting people from the city to the countryside is one of the objectives of the programme.
HOUSING RENOVATION
Half a million houses will be renovated to achieve greater energy efficiency, with the state paying in some cases 100% of the expenses in a plan valued at 6.8 billion euros.
NEW GENERATION MOBILITY
Spain will use EU funds to create a public-private consortium with Volkswagen (DE:VOWG_p)’s Spanish unit SEAT and power company Iberdrola (OTC:IBDRY) and build its first plant making electric-car batteries.
Along with tourism, automaking is a key sector in Spain, accounting for up to 10% of GDP, so 800 million euros will be used to subsidise the purchase of electric cars. The sustainable mobility strategy will total 13.2 billion euros.
ENERGY TRANSITION
Spain will auction concessions to build 6,000 MW of renewable energy capacity, and 1.5 billion euros will be earmarked for hydrogen projects. By 2023, 150,000 fast-charging points will be installed to support electric vehicles.
REFORMS
The Socialist-led coalition government has promised to repeal some labour and pension reforms adopted by a previous conservative government during the European debt crisis. Other planned reforms include reinforcing the health system, water sanitization and a housing bill.
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Source: Economy - investing.com
