NextGenerationEU: forecasted additional increase in yearly GDP 2021-2030
The NextGenerationEU economic stimulus is set to boost the European economy in the aftermath of the COVID-19 pandemic. The plans for NextGenEU were created in 2020, during the height of the Coronavirus crisis, with all member states of the European Union experiencing drastic reductions in their GDPs. The stimulus packages were decided upon by the institutions of the EU along with the member states, who were required to draw up national recovery & resilience plans outlining how they would allocate the funds, with the aim of boosting the long-term growth of the European economy in a sustainable and ecological way.
The economic stimulus is set to boost the overall GDP growth of the EU by between 0.6 percent and 1.5 percent depending on the year and the forecasted scenario. Forecasts which operate under the assumption that member states will spend their allocated funds early in the period of 2021-2026 (the period over which NGEU is set to run) show a rapid increase in GDP growth over the years from 2022 to 2024, after which growth increases will be more moderate. On the other hand, forecasts which assume that member states will spend funds equally across the years 2021-2026 show a less pronounced spike in growth, but which results in a higher rate of growth in the latter half of the 2020s, after the programs' implementation periods are finished.
The economic stimulus is set to boost the overall GDP growth of the EU by between 0.6 percent and 1.5 percent depending on the year and the forecasted scenario. Forecasts which operate under the assumption that member states will spend their allocated funds early in the period of 2021-2026 (the period over which NGEU is set to run) show a rapid increase in GDP growth over the years from 2022 to 2024, after which growth increases will be more moderate. On the other hand, forecasts which assume that member states will spend funds equally across the years 2021-2026 show a less pronounced spike in growth, but which results in a higher rate of growth in the latter half of the 2020s, after the programs' implementation periods are finished.
