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The EU must consider setting up a long-term fiscal stabilisation tool when the current Recovery and Resilience Fund expires in 2026, EU Economic Affairs Commissioner Paolo Gentiloni told the ECB's Fifth ECB biennial conference on fiscal policy and EMU governance. Noting the important counter-cyclical role that the RRF has played during the current Covid crisis, Gentiloni said it was not “in the DNA” of the Recovery Fund to play a ‘stabilisation’ role, given its 2026 expiry.
Addressing current Covid concerns, Gentiloni said new measures being introduced in some EU countries could already be weighing on growth, but added that he remained of the view that the economic impact of the latest measures would not be as severe as those seen last year.