THE European Commission on Wednesday (27) proposed borrowing €7.7 billion ($8.49 billion) on financial markets to fund extra spending on vaccines, drugs and healthcare over the next four years and reduce its dependency on foreign supplies.
The plan, which requires approval from EU member governments and lawmakers, would complement a $2.6 billion emergency fund which could also be deployed to address medical shortages in the bloc highlighted by the COVID-19 pandemic.
"Europe should strive to strengthen its strategic autonomy by reducing excessive import dependence for the most-needed goods and services such as medical products and pharmaceuticals," an EU document published on Wednesday said.
Under the proposal, the Commission would use the EU's €1.1-trillion-long-term budget as a guarantee to borrow €750 billion, of which €7.7 billion would be used for medical expenses until the end of 2024.
Another €1.7 billion would be made available for health spending directly from the EU budget until 2027.
The Commission, the EU's executive arm, said the aim of the overall package would be ensuring strategic supplies of drugs and medical equipment, helping the development and production of vaccines in the EU, and strengthening the 27-nation bloc's preparedness and prevention of future health crises.
The Commission did not provide a breakdown of medical expenditures, but stressed the need to address "vulnerabilities" that emerged during the COVID-19 outbreak.
These included temporary shortages of crucial medicines, partly due to disruptions in supplies of chemical ingredients in drugs, for which the EU relies on China and India for 80 per cent of its needs.
The crisis has also exposed the EU's limited vaccine production capacity, which may leave the bloc with a shortage of COVID-19 shots if they became available.
Under the €7.7 billion plan, for which more details are expected on Thursday (28), Brussels would also offer "incentives" to the pharmaceutical industry to relocate production of vaccines and essential drugs to the EU.
