The EU’s covid-19 recovery fund has worked, but not as intended

FEBRUARY 19TH will mark three years since the European Union’s recovery fund came into force. Known in Brussels jargon as NextGenerationEU (NGEU), this multi-year budget worth €832bn ($897bn, or 5.2% of the bloc’s GDP in 2022) is funded by EU debt, previously a rare commodity. It is the main political innovation to emerge from the pandemic in Europe. Some called it Europe’s Hamiltonian moment, invoking Alexander Hamilton, America’s first treasury secretary, who masterminded the fiscal federalisation of the United States. But the EU is some way from a fiscal federation. Northern finance ministers insist that the recovery fund was a one-off. And the extent of its success is still unclear.