‘Marshall Plan’ for Distressed EU Economies

BONN, Germany (CN) - The European Commission wants to sweeten the deal for six European Union nations with troubled economies, passing measures this week that allow Greece, Ireland, Portugal, Romania, Latvia and Hungary to reduce their matching-funds contribution to EU development programs by more than $4 billion.

Commission President José Manuel Barroso likened the measures to the Marshall Plan, in which the United States financially supported the rebuilding of European countries after World War II.

All six countries are receiving EU bailout help, under different mechanisms for euro zone countries like Portugal, Greece and Ireland, and the non-euro zone countries of Romania, Latvia and Hungary. The countries have taken in international bailout aid since 2008.

The new measures, which are tied to the countries' participation in bailout plans, reduce the amount each must contribute to EU funds for agricultural, fisheries, social and infrastructural programs.

The six nations may apply to pay only 5 percent, instead of the former minimum of 15 percent, in matching funds toward these programs. This would result in a total savings of around $4.1 billion, the commission estimates.

It hopes this will encourage economic growth and reduce unemployment, as worker-training programs and infrastructure projects are prioritized.

Greece would see the biggest benefit, of about $1.25 billion, and would get a special task force to ensure implementation of the savings.

Amid criticism that it has not acted enough, Greece has been struggling to carry out reforms conditioned on EU bailout money. Greek citizens have been resisting many of these reforms, including privatization efforts they see as socially harmful.

The European Council and European Parliament will have to approve the measures before they can be enacted. The commission hopes this will happen under a fast-track process before the end of this year.

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