Share of EU Recovery & Resilience Facility funds allocated for Green Transition 2020

The Recovery & Resilience Facility (RRF) is a instrument created by the European Union as part of their economic stimulus plan launched in the wake of the COVID-19 pandemic, known as the NextGenerationEU plan, which seeks to boost the European economy through strategic investments in the green transition, digital infrastructure, and social, economic, and institutional development. The RRF will distribute over 700 billion Euros to EU member states over the period from 2021 to 2027, with which they are free to decide how they see fit to invest the funds across the three focus categories.

There is a trend among the member states in how they distributed the funds, with those states with stronger economic growth tending to invest more in the green transition, while struggling states have tended to prioritize investments in digital infrastructure or institutional development, which may be more urgent for their short-term economic needs. The absolute amount of funds distributed was determined by the weakness of the economy and the level of impact which the pandemic had on the domestic economy, with Greece, Romania, Croatia, and Italy receiving the most funds in relation to the size of their GDP.

Denmark, Luxembourg, and Poland were the three countries which allocated the most of their RRF funds to green transition projects, with Denmark allocating an astounding 92 percent. On the other hand, Greece, Slovakia, and Latvia allocated the least to these projects. The fact that no member states allocated less than a third of their funds to green transition projects highlights the consensus in Europe that urgent action is needed to tackle climate change, with the RRF and NextGenEU plans being the first projects to be implemented as part of the EU's Green Deal.