BRIEF: ECB's Panetta-Time To Start Thinking Of NGEU Successor
MNI (BRUSSELS) - The European Union must start thinking about what should replace its post-pandemic recovery instrument NextGenerationEU after it ends in 2026, Bank of Italy Governor Fabio Panetta said on Wednesday.
The scope and design of such future policy tools would depend on how successful the current NGEU program is, he said, particularly the ability of individual countries to profitably use funds available.
Both Italy and Spain, NGEU's two biggest beneficiaries, have been slow to absorb funds available under the instrument although disbursements are now accelerating ahead of the 2026 deadline.
Panetta said it was an “illusion” to think that the EU could operate effectively without a central fiscal capacity, which would also facilitate large-scale strategic investments.
The comments come ahead of the long-awaited publication of former ECB President Mario Draghi’s report on EU global competitiveness, expected around the middle of next month. (See MNI INTERVIEW: Risk Draghi Report Ushers In EU Protectionism)