European Commission wants to borrow 70 billion euros through bonds

The European Commission recently announced its intention to issue EU bonds worth up to 70 billion euros in the second half of 2025, a press release from the Community Executive informs, according to Agerpres.

The planned issuance is in addition to the 86 billion euros collected in the first half of the year, in line with the previously communicated planned issuance for the whole of 2025, of around 160 billion euros.

The issuance will finance payments for NextGenerationEU and other policy programs, such as the Facility for Ukraine, the Reform and Growth Facility for the Western Balkans and macro-financial assistance loans granted to neighboring countries.

In line with established practice, the Commission will carry out these issuances within the framework of its unified financing approach, using biannual financing plans to communicate target issuance volumes based on the evolution of financing needs.

The Commission will continue to issue NextGenerationEU Green Bonds to finance the green window of the Recovery and Resilience Facility (RRF). So far, euro75 billion has been mobilised through NextGenerationEU Green Bonds.

Further NextGenerationEU Green Bond issuances will depend on Member States notifying and validating additional climate-relevant expenditure in line with the NextGenerationEU Green Bond Framework.

The European Commission borrows on international capital markets on behalf of the EU and disburses funds to Member States and third countries under several lending programmes. EU loans are guaranteed by the EU budget and contributions to the EU budget are an unconditional legal obligation of all Member States under the EU Treaties.

Based on EU bonds and NextGenerationEU green bonds collected since mid-2021, the Commission has so far disbursed over euro304 billion in grants and loans to EU Member States under the Recovery and Resilience Facility. Up to euro74 billion has been allocated to other EU programmes benefiting from NextGenerationEU funding.

Starting in January 2023, the Commission will issue single-brand EU bonds, rather than separately labelled bonds for individual programmes, structured around pre-announced six-monthly financing plans and issuance windows.