EU leaders pledge funds

Council decisions will see Greece receive 160-180 mln to fight youth unemployment

Greece’s delegation appeared pleased with the outcome of the European Council yesterday as leaders promised up to 180 million euros to tackle youth unemployment and increased lending from the European Investment Bank (EIB) over the next few years.

“Now, everyone recognizes that growth and employment, along with fiscal consolidation, are fundamentally and inextricably bound and create the only way out of the crisis,” said Prime Minister Antonis Samaras after the European Union leaders’ summit in Brussels ended.

The council conclusions called for the “speeding up and frontloading of the Youth Employment Initiative; speeding up implementation of the Youth Guarantee; increased youth mobility and involvement of the social partners.” The leaders pledged 6 billion euros to tackle youth unemployment. Of this, between 160 and 180 million euros is expected to go to Greece, where almost 60 percent of Greeks aged between 15 and 24 are out of work. Regions where youth unemployment is higher than 25 percent will be prioritized for the funds. All regions of Greece fall in this category. Greece has argued that the size of funds each country or region receives should be linked to the rate of youth unemployment.

Government sources said that the last EU package aimed at tackling youth unemployment led to Greece receiving 155 million euros, which helped fund work places for 45,000 Greeks under the age of 29.

The EU leaders also called for the “mobilization of European resources including those of the EIB; and launched a new ‘Investment Plan’ to support SMEs and boost the financing of the economy.” The European Council said it would like to see the EIB increase its lending activity by 40 percent between now and 2015.

The EIB has identified lending opportunities worth 150 billion euros and the Greek government hopes that local SMEs in particular could benefit from this. It is not clear how much of this funding Greece would qualify for.

The EU leaders also finalized the reduced EU budget of 960 billion euros for the 2014-20 period. This means that Greek farmers will receive up to 18 billion euros in subsidies.