REACT-EU: Assistance in recovery

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In the context of a better presentation of European Union programs to finance specific actions in the Member States, Anthi Filippidou, Director of EU Cohesion Policy, Directorate-General for Development, at the Ministry of Finance, answers questions about the “Assistance to Cohesion Recovery and Regions of Europe (REACT-EU) “, the way the program was implemented or is being implemented in Cyprus, the social groups and entities that benefited and the contribution that the state budget made to some expenditures during the pandemic.

What exactly is the “Assistance to Europe Cohesion and Regions (REACT-EU) Recovery Program” and how will Cyprus benefit?

The Cohesion and Regions of Europe (REACT-EU) Assistance Program was the first tool used under NextGenerationEU to extend the pandemic crisis response and rehabilitation measures implemented. with the Coronavirus (CRII) Investment Initiative and the Coronavirus + (CRII +) Investment Initiative, and allows the transition to the long-term recovery plan. In the framework of the Program “Assistance to the Recovery for Cohesion and the Regions of Europe (REACT-EU)”, the Republic of Cyprus has secured additional resources totaling approximately € 132 million, which were allocated to the existing Cohesion Policy Programs of the program period 2014-2020 for the two years 2021 and 2022, taking into account the provisions of Regulation (EU) 2020/2221, in order to support the rehabilitation of the consequences of the crisis, including social, due to the COVID-19 pandemic and to prepare a green , digital and resilient economy.

More specifically, in the context of the unprecedented conditions created by the COVID-19 pandemic, the resources that will be channeled to the European Social Fund – ECB will be used exclusively to support employees through the implementation of Short-Term Employment Support Plans (€ 65 million). . These Plans aim to protect workers from the risk of unemployment, while maintaining the same level of working conditions and employment as wages.

The funds to be allocated to the European Regional Development Fund – ERDF will be allocated to support companies affected by the pandemic & nbsp; (€ 57 million), while the remaining € 10 million will be allocated to actions that contribute to its objectives. climate change, taking into account the relevant provision of the Regulation, as well as the importance of addressing the effects of climate change in Cyprus.

As can be seen from the above distribution, Cyprus attaches particular importance to supporting businesses and workers, which are the productive fabric of the economy and have been most affected by the crisis, as the pandemic has had a negative impact on all sectors of the economy./p>

What is the difference between this package and other EU packages for Cyprus? I mean there were other procedures, was it faster, did it have other specifications?

The European Cohesion and Regions Recovery Assistance Program (REACT-EU) is not a new Cohesion Policy Fund, but provides additional funding to the European Regional Development Fund and the European Social Fund for 2014-. 2020, hence the procedures are much faster and more efficient. The rapid adoption of the measures has allowed Member States to allocate € 37 billion to existing programs almost immediately. These funds can be used until the end of 2023, as already applies to the initial funds. These funds have been used mainly to bridge the gap between the emergency measures taken at the beginning of the crisis and the long-term recovery of its consequences.

Digital and green transition

Two stable pillars of European grants are the digital transition and the green economy. Are they included in REACT-EU?

In essence, the Program “Assistance to the Recovery for Cohesion and the Regions of Europe (REACT-EU)” is the necessary bridge between the two programming periods 2014-2020 and 2021-2027, which was deemed necessary due to the pandemic crisis. In this light, it can finance needs that, under other circumstances, were not eligible, such as the purchase of medicines and pharmaceutical services. At the same time, the two fronts of European funding that you mentioned could not be absent. It is noted that the effort of Green and Digital Transition started from the programming period 2014-2020 and intensified after 2020.

Do the programs as they are created only finance jobs or even additional business expenses and actions?

Lump sums were paid to companies and self-employed persons in various time periods (May/June 2020, November 2020, March 2021, April 2021, May 2021) to cover operating expenses. Expenditures related to these amounts are covered by the state budget. Part of the one-off sponsorship for the self-employed is covered by the “SURE” joint lending initiative.

By which bodies or ministries is the program implemented in Cyprus?

The Program “Assistance to the Recovery for Cohesion and the Regions of Europe (REACT-EU)”, which amounts to € 132 million for Cyprus, has as Managing Authority the General Directorate of Development, at the Ministry of Finance, which is also the Managing Authority for all EU Cohesion Funds. The implementing bodies are the Ministry of Labor and Social Security (€ 122 million) and the Ministry of Transport, Communications and Works (€ 10 million). & nbsp;

REACT-EU also applies to small and medium-sized enterprises, but what about the self-employed?

The Program “Assistance to the Recovery for Cohesion and the Regions of Europe (REACT-EU)” covers expenses related to the Special Plans addressed to companies-companies as well as companies owned by self-employed persons. However, especially for the self-employed, a Plan was implemented throughout the period of implementation of the Covid-19 Special Plans, ie from 16/3/2020 to 31/10/2021, with the exception of the period 13/6/2020-30/6/2020. The cost of this project was covered by the state budget, through the “SURE” joint lending initiative. In addition, the self-employed were given a special one-time grant at various times.

Will the needs related to the new crisis be met?

Do you have any idea if this program will continue in 2022, given both the pandemic and the war in Ukraine now?

“REACT-EU” is part of “NextGenerationEU” and provides additional funding for Cohesion Policy Programs for the 2014-2020 programming period, which should be utilized by the end of 2023. 'As mentioned in Answer 1 above, all its resources have been planned.' REACT-EU “, which will be fully utilized by the end of 2023. & nbsp; As regards the consequences of the war in Ukraine, the European Commission, in cooperation with the Member States, is already in the process of adopting amendments to the regulations of the European Funds, to enable Member States to finance actions to address them. At this stage it is only possible from existing initial allocations of resources that have not yet been used for other actions and does not involve additional amounts. & nbsp; & nbsp;