The impact of Next Generation funds on the Spanish economy

Afi has collaborated with Funcas in the preparation of a monograph on the implementation, design, execution and impact of the Recovery, Transformation and Resilience Plan, entitled: “The impact of Next Generation funds on the Spanish economy”.

The first chapter of this work, linked to the macroeconomic impact of the Plan and developed by Funcas, highlights that the Recovery Plan would have explained between 10% and 14% of Spanish GDP growth in the period 2021-2025, contributing between 1.4 and 2.1 percentage points to the level of GDP during that period.

In the second chapter, “Spain's Recovery, Transformation and Resilience Plan: Design and Execution”, prepared by Afi's Public Finance, Applied Economics and Analysis and Markets teams, with execution data up to September 2025, the following messages stand out:

• To date, Spain has received more than 71 billion euros in five payments, divided into 55 billion in transfers and 16 billion in loans, after certifying compliance with more than 260 milestones and objectives, more than half of those committed. After Italy, it ranks as the country in the European Union that has complied with the most measures to date.

• The strategy of Frontloading of the plan has made it possible to make rapid progress in reforms, but it has shifted a very significant part of the implementation effort to investments in the final phase of the program.

• The mobilization of funds has been high — more than 85 billion euros in calls and tenders — reflecting a significant institutional effort to ensure their execution. However, the resolution as of September 2025 was close to 50 billion (more than 60 billion today), so there is still a significant amount of funds to be implemented.

• Multilevel governance has been key to the deployment and capillarity of the Plan, although high volumes have strained the structures and capacities of the Autonomous Communities and Local Corporations, also showing uneven execution rates between administrations and territories.

• The instruments of the plan have shown heterogeneous behavior. Grants have had greater traction than loans, and simpler designs have facilitated greater absorption of funds.

• The sectoral execution reflects the priorities of the PRTR, with a concentration on industry, digitalization, energy and construction, consistent with the structural transformation objectives set initially.

• The final phase of the plan will be decisive. Meeting the remaining milestones and objectives would allow an additional $30 billion to be received. The ability to simplify, reprogram (as the successive modifications of the Plan have demonstrated) and prioritize actions over the last few months will condition the degree of final execution and, with it, the economic impact of the entire program.

• The economic impact of the PRTR will extend beyond 2026 thanks to the introduction of financial instruments, capital injections (such as the one implemented through the ICO with España Crece), or the fractionation and subsequent financing with national funds of some of the measures.

The objective of the monograph is to become a reference for all those interested in the different aspects that have marked the Recovery Plan since its inception.

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