NextGenerationEU: European Commission raises €20 billion in first transaction to support Europe's recovery

The European Commission has, in its first NextGenerationEU transaction, raised €20 billion via a ten-year bond due on 4 July 2031 to finance Europe’s recovery from the coronavirus crisis and its consequences. This is the largest-ever institutional bond issuance in Europe, the largest-ever institutional single tranche transaction and the largest amount the EU has raised in a single transaction.

The band has attracted very strong interest from investors across Europe and the world, thanks to which the Commission has obtained very favourable pricing conditions, similarly to the repeatedly successful issuances under the SURE programme.

European Commission President Ursula von der Leyen said: ”Is a truly historic day for our European Union. We successfully conducted the first funding operation for NextGenerationEU. As a strong Union, we are raising money at the markets together and investing in a common recovery from this crisis. It is an investment in our single market. And even more importantly, it is an investment in the future of Europe’s next generations as they face the challenges of digitisation and climate change. Money can now start flowing to help to reshape our continent, to build a greener, more digital and more resilient Europe. I will now visit every Member State, to see NextGenerationEU impact on the ground.”

Commissioner in charge of Budget and Administration, Johannes Hahn, said: ”We have reached a key milestone in implementing NextGenerationEU. After laying all the foundation at record speed, we have today successfully conducted the first borrowing operation under the Recovery Plan. This is just a very first step of a long journey, bringing over €800 billion in current prices into the EU economy. NextGenerationEU has now become a reality and is set to drive our collective recovery from the pandemic, setting Europe on a green, digital and resilient path.”

The funds will be used for the first payments under NextGenerationEU, under the Recovery and Resilience Facility and various EU budget programmes.

By the end of 2021, the Commission expects to raise some €80 billion in bonds, to be complemented by short-term EU-Bills. The exact amount of both EU-Bonds and EU-Bills will depend on the precise funding needs, and the Commission will revise its initial assessment in the autumn. In this way, the Commission will be able to fund, over the second half of the year, all planned grants and loans to the Member States under the Recovery and Resilience Facility, as well as cover the needs of the EU policies that receive NextGenerationEU funding.