Italy and the European Union have agreed on a deal that will unlock a long overdue third instalment of Recovery Fund cash, with some of the money and targets pushed to the next deadline. (Photo by Pier Marco Tacca/Getty Images)

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Italy strikes deal with EU to unlock third tranche of recovery fund

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Italy and the European Union have agreed on a deal that will unlock a long overdue third instalment of Recovery Fund cash, with some of the money and targets pushed to the next deadline.

The agreement with the EU takes pressure off Prime Minister Giorgia Meloni, who has been heavily criticized by the opposition over her inability to get a payout.

Brussels will give Italy €18.5 billion ($20.7 billion) in its third tranche instead of the originally planned €19 billion, with the missing amount delayed to the fourth instalment, the government said in a statement Thursday. The overall payout for this year stays €35 billion.

The country is the biggest beneficiary of the EU’s post-pandemic program with almost €192 billion coming its way in the next few years. So far, it has received €67 billion but the latest instalment of funds has been frozen since last year after the EU asked for clarification on some of the targets needed to unlock the cash.