A €5 billion ($5.9 billion) EU fund to compensate bloc members for the economic loss of Brexit was officially established on Friday.
The €5-billion fund, officially named Brexit Adjustment Reserve, will help businesses and local communities cope with the financial and social impact of the UK’s departure from the EU by creating new jobs or supporting EU citizens' reintegration.
“Cash flow can now be disbursed to all those affected by Brexit,” Charles Michel, the president of the European Council, said on social media, welcoming the entry into force of the legislation adopted by the European Parliament and EU member states in September.
“A great gesture of solidarity,” Michel added, referring to the fact that the governments would receive support from the EU budget based on how much their economy suffered from the UK’s decision to leave the bloc.
The grants will be calculated based on the EU countries’ trade relationship with the UK, the importance of fisheries in the UK exclusive economic zone, and their population living in maritime regions bordering the UK.
With a total of €1 billion in financial support, Ireland will be the biggest beneficiary of the fund. The Netherlands will receive €810 million ($936 million), while France will be given €670 million ($774 million).
In total, €1.6 billion ($1.9 billion) will be transferred to the beneficiaries this year, and the countries can count on two more installments until Dec. 31, 2023.
The UK left the EU on Jan. 31, 2020 after 47 years of membership.