Spain is urging the EU to embrace joint borrowing as a permanent tool to expand its central budget, doubling the bloc’s spending power. The proposal calls for reviving the post-Covid recovery scheme, set to expire next year, and using it to finance strategic investments and European public goods.
While Spain, France, and Italy back the idea, northern nations like Germany strongly oppose it, wary of footing the bill for countries with higher borrowing costs. With the EU preparing its next seven-year budget (2028-2034), Spain is the first major country to outline its vision ahead of the Commission’s upcoming proposal this summer.
Madrid also wants to delay repayment of the EU’s €300 billion debt to free up cash for priorities like the green transition. The government argues this move would ease short-term fiscal pressures and stabilize EU bond markets. However, critics warn it’s a slippery slope toward a full fiscal union where the EU permanently takes on debt for its 27 members.
Spain additionally supports EU-wide taxes, provided they don’t cut into national revenues, and suggests tapping into the €422 billion European Stability Mechanism to handle economic fallout from Russia’s war in Ukraine. While some EU leaders remain skeptical, Spain insists a stronger, better-funded EU is necessary to navigate future crises.
