European Commission endorses a positive preliminary assessment of Cyprus' request for €85 million disbursement
The European Commission has endorsed today a positive preliminary assessment of Cyprus' payment request for €85 million in grants under the Recovery and Resilience Facility (RRF), the key instrument at the heart of NextGenerationEU.
On 28 July 2022, Cyprus submitted to the Commission a payment request based on the achievement of the 14 milestones set out in the Council Implementing Decision for the first instalment. They cover reforms and investments in the electricity market, in the areas of energy efficiency and circular economy, and anti-corruption and transparency. Measures in the financial sector and public administration, in the domain of digital skills, as well as Cyprus' audit and control system for the implementation of the RRF are also covered.
The milestones fulfilled demonstrate significant progress made in the implementation of Cyprus' recovery and resilience plan and its broad reform agenda. They include important measures like the reform ensuring the independence of the Cyprus Transmission System Operator from the incumbent Electricity Authority of Cyprus, a National e-Skills Action Plan and laws on transparency in public decision-making and on the protection of whistle-blowers. A reform that aims at reducing the level of non-performing loans is also included.
With their request, the Cypriot authorities provided detailed and comprehensive evidence demonstrating the fulfilment of the 14 milestones. The Commission has thoroughly assessed this information before presenting its positive preliminary assessment of the payment request.
The Cypriot recovery and resilience plan includes a wide range of reforms and investments in 13 thematic components. It is worth over €1.1 billion, of which €916 million in grants and €200 million in loans. €157 million was already disbursed to Cyprus in pre-financing on 9 September 2021.
Payments under the RRF are performance-based and contingent on Member States implementing the reforms and investments outlined in their respective recovery and resilience plans.
Next steps
The Commission has now sent its positive preliminary assessment of Cyprus' fulfilment of the milestones required for this payment to the Economic and Financial Committee (EFC), asking for its opinion. The EFC's opinion, to be delivered within a maximum of four weeks, should be taken into account in the Commission's assessment. Following the EFC's opinion, the Commission will adopt the final decision on the disbursement of the financial contribution, in accordance with the examination procedure, through a comitology committee. Following the adoption of the decision by the Commission, the disbursement to Cyprus can take place.
The Commission will assess further payment requests by Cyprus based on the fulfilment of the milestones and targets outlined in the Council Implementing Decision, reflecting progress on the implementation of the reforms and investments.
The amounts disbursed to the Member States are published in the Recovery and Resilience Scoreboard, which shows progress of the implementation of the national recovery and resilience plans.
Members of the College said
President of the European Commission Ursula von der Leyen said: “I have good news for Cyprus. Sufficient progress has been made in the rollout of its recovery and resilience plan to receive a first payment under NextGenerationEU. Once Member States give their greenlight, Cyprus will receive 85 million euros as a result of its good and swift progress in implementing the plan's first set of reforms and investments. These include important measures for the green and digital transition, as well as measures to enhance financial stability and to fight corruption. So, congratulations Cyprus! The Commission stands by your side, to make your NextGenerationEU plan a success.”
Valdis Dombrovskis, Executive Vice-President for An Economy that Works for People said: “Congratulations to Cyprus for meeting the first 14 milestones set out in its recovery and resilience plan. Many of these will contribute to Cyprus' green and digital transitions, with reforms to its electricity market, investments to promote the use of renewable energy, promotion of the circular economy and a national plan to boost digital skills. Cyprus is also strengthening the fight against corruption and improving the environment for reducing non-performing loans. Once the Commission's assessment is reviewed and approved by Member States, Cyprus should receive €85 million in grants to help create a more resilient economy with higher growth prospects.”
Paolo Gentiloni, Commissioner for Economy, said: “Today marks a key step forward in the implementation of the Cypriot recovery and resilience plan. The completion of the first 14 milestones will open the way, once the relevant procedures are completed, to a disbursement of €85 million. The Recovery and Resilience Facility is the strongest common tool we have at our disposal and I encourage the Cypriot authorities to pursue its implementation with determination. Making a success of this opportunity is of fundamental importance as we together navigate the current troubled waters and work to make our economies more sustainable, inclusive and competitive.”
