EU approves sixth payment for Spain but suspends €537 million due to unmet targets

The European Commission has partially approved Spain's request for the 6th payment under the NextGenerationEU, the EU's post-pandemic recovery hub. While the total package is worth €5.7 billion, the Commission commended the Spanish government for fulfilling the majority of the agreed targets. The decision notes that 64 out of 67 targets were successfully completed, alongside 51 milestones, and praises the country's progress in the recovery process. This approval is significant as it shows that Brussels views Spain's economic and structural reforms favorably.

The Commission emphasized that this payment will support reforms and investments in vital areas such as biodiversity, sustainable mobility, and research and development. Key areas for the use of funds include social rights, education and vocational training, culture, tourism, water management, and justice system efficiency. These investments aim to enhance Spain's long-term growth potential and strengthen alignment with EU standards. Additionally, some milestones that were previously suspended but have since been completed were included positively in this payment.

A milestone regarding the digitalization of regional and local institutions, which was only partially fulfilled, had been suspended during the 5th payment. Following Spain's successful resolution of deficiencies and completion of the digitalization process, the Commission decided to release the suspended amount of €25 million. This confirms that improvements in Spain's digital infrastructure and governance have been accepted by EU authorities. The achievement of this target, albeit delayed, was hailed as a positive signal of the country's strengthened administrative capacity.

Regarding another milestone in the financial sector, additional evidence submitted by Spain led to a positive decision. In light of the new evidence, the Commission moved to lift a significant portion of the previous suspension and proposed an additional transfer of €277 million to Spain. This development indicates that disagreements regarding taxation and financial compliance have been resolved, accelerating the flow of funds. It is assessed that Spain is demonstrating a stance closer to EU norms in its fiscal policies, with tangible financial results.

Nevertheless, the process has not been entirely smooth; the Commission announced that it cannot currently assess 3 targets within the sixth payment request. Uncertainties regarding bilingual vocational training, remote care services for vulnerable groups, and investments for entrepreneurship and micro-enterprises influenced this decision. The Spanish government plans to submit the necessary request to modify these targets, pledging to maintain the preventive policy ambition. Consequently, approximately €537 million will remain temporarily suspended until these matters are clarified.