The recovery and resilience facility: A springboard for a renaissance of public investments in Europe?

The Policy Brief analyzes to what extent the funds provided by the Recovery and Resilience Facility (RRF) are used by member states to finance new projects (additionality of public investments). The analysis shows that in the EU-27 there is no significant relationship between the amount of RRF grants (in % of GDP) and the acceleration in public investment. This suggests that RRF funds are mainly used to finance existing investment projects. An in-depth analysis of the National Recovery Resilience Plans of Austria, Belgium, Germany, Spain, Italy and Portugal reveals substantial heterogeneity across countries. The share of new investments projects is smallest in Austria (19%) and Germany (20%) and highest in Belgium (77%). The shares amount to 40% in Spain and to 64% in Italy and Portugal.