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EU proposes €55B for measures to boost reforms, recovery from shocks

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EU proposes €55B for measures to boost reforms, recovery from shocks

The European Commission proposed the creation of two financial vehicles funded with a combined €55 billion to boost EU member states' reforms and recovery from financial crises.

Under the proposal, a Reform Support Program will be formed with a budget of €25 billion to back reform efforts in a range of areas including labor markets, tax systems, capital markets, business environment and public administration.

The program will be open to all EU member states, the Commission said, while "targeted support" will also be offered to those wishing to join the euro.

A second facility, the European Investment Stabilization Function, will also be established and provide up to €30 billion in loans to member states hit by "large asymmetric shocks" to protect public investment and drive faster economic recovery.

The facility would also grant member states an interest rate subsidy to cover the costs of the loans. Only nations with sound fiscal and macroeconomic policies could obtain the loans, according to the Commission.

The Commission proposed setting up the new funds for the EU budget covering the period from 2021 to 2027.

"Today's proposals are about making the Economic and Monetary Union the protecting and uniting force that it was conceived to be," said European Commission President Jean-Claude Juncker.