May 27 (UPI) -- The European Union on Wednesday proposed a $825 billion stimulus plan to help stabilize member states amid a recession brought on by the COVID-19 crisis.
The European Commission unveiled the major recovery package titled, "EU budget powering the Recovery Plan for Europe," which the bloc said includes a "powerful, modern and revamped long-term" budget.
"The recovery plan turns the immense challenge we face into an opportunity, not only by supporting the recovery but also by investing in our future: the European Green Deal and digitalization will boost jobs and growth, the resilience of our societies and the health of our environment," said European Commission President Ursula von der Leyen.
"This is Europe's moment. Our willingness to act must live up to the challenges we are all facing. With Next Generation EU we are providing an ambitious answer."
European Commissioner for the Economy Paolo Gentiloni called the plan a European "turning point to face an unprecedented crisis."
The European Parliament must approve the deal along with each of the bloc's 27 member states.
The union is in its deepest recession in its history due to the economic impact of the pandemic. The economy of each EU nation is projected to shrink this year, with those most affected -- like Italy and Spain -- expecting contractions of at least 10 percent.
Von der Leyen said most of the funds will be comprised of grants and about a third will be loans.
Analysts now expect weeks of negotiations among EU members to address concerns and the conditions attached to the rescue funds.
Germany and other northern EU members have expressed reservations about dipping into their national budgets to bail out economies of their southern neighbors.
"The recovery will need strong policy direction," said EC Vice President Maros Sefcovic. "The [plan], reflecting the new reality, shows that we will focus all our actions on overcoming the crisis, jumpstarting our economy and putting the European Union firmly on a resilient, sustainable and fair recovery path."