The European Central Bank published an analysis of EU State aid showing that expenditure has risen sharply over recent years, driven first by crisis support and then by a broader turn toward industrial policy. State aid peaked at EUR 330 billion in 2020 and 2021, or 2% to 2.5% of EU GDP, and although it fell to 1% of GDP in 2024, it remains above the 0.5% to 0.8% range seen between 2000 and 2013. The ECB says the orientation of aid has also changed, moving beyond traditional support for innovation, regional cohesion and smaller firms toward environmental protection, decarbonisation, energy security, competitiveness and strategic resilience. The analysis links the expansion in aid to more flexible EU frameworks, including wider exemptions from prior European Commission approval from 2014 and later Temporary Frameworks introduced for the COVID-19 pandemic, Russia’s invasion of Ukraine and, most recently, sectors affected by the Middle East crisis. It highlights the growth of Important Projects of Common European Interest as a sign of more strategic aid deployment, with approved aid and associated private investment reaching about EUR 90 billion by 2024 in areas such as batteries, hydrogen, microelectronics and health technologies. Distribution has been uneven across countries and sectors, reflecting fiscal capacity and policy priorities. Firm-level evidence indicates that energy firms historically received most aid, services gained during the pandemic and manufacturing became more prominent afterward, while large firms and more productive firms remained more likely to receive support across periods. The ECB says these trends raise questions about how State aid can support shared EU objectives and new policy priorities while preserving Single Market competition and fiscal sustainability, particularly as the EU negotiates its 2028-2034 Multiannual Financial Framework. It says further analysis is needed on those issues.
European Central Bank2026-06-23
European Central Bank analysis finds EU State aid remains above historical levels and has shifted toward strategic industrial priorities
The European Central Bank published an analysis showing that EU State aid remains above historical norms after surging during recent crises, even though it fell to 1% of GDP in 2024 from a EUR 330 billion peak in 2020 and 2021. It says aid has shifted from broad crisis support toward decarbonisation, energy security, competitiveness and other strategic priorities, with Important Projects of Common European Interest becoming a major channel. The ECB adds that the uneven distribution of aid across countries and sectors raises questions for competition and fiscal sustainability.