LISBON (Reuters) -Portugal on Wednesday became the first EU country to have its recovery plan rubber-stamped by the European Commission, whose president Ursula von der Leyen said an initial disbursement from the bloc’s COVID-19 recovery fund should come in July. “The plan clearly meets the demanding criteria we have jointly established,” von der Leyen told reporters after meeting Portuguese Prime Minister Antonio Costa in Lisbon. “There is no doubt that it will deeply transform Portugal’s economy.” Under the scheme, which is yet to be approved by the Council of the European Union in a maximum of four weeks’ time, Portugal will get 13.9 billion euros ($16.85 billion) in grants and 2.7 billion euros in loans until 2026. “We know, dear Ursula, that the hard work begins now,” a smiling Costa said. “We want to launch many of these instruments already in coming days.” Planning Minister Nelson Souza told Radio Renascenca earlier applications for the EU funds would open next week. In April, Lisbon was also first with the official submission of its plan to Brussels, expecting the recovery programme to increase GDP by 3.5% by the end of 2025, compared with what it would be without it. Portugal’s tourism-dependent economy contracted 7.6% in 2020, in its steepest recession since 1936. It plans to give around 5 billion euros to companies, reinforcing their equity, supporting investments in innovation, greener production processes, digital tools and skills. The plan also envisages dozens of investment projects in health, social housing and infrastructure. The government has predicted economic growth of 4% this year, while the central bank earlier on Wednesday raised its growth forecast to 4.8% from 3.9% predicted in March, expecting a sharp increase in investment already benefiting from the European recovery fund. Still, a majority of companies surveyed by Portugal’s Business Confederation (CIP) in early June were sceptical that the funds would have much impact on their ability to recover from the crisis, with just 14% saying it would be significant or very significant. Many are still saddled with debt from loans issued by the government earlier in the pandemic, with bankruptcies expected to increase as repayment deadlines draw closer. ($1 = 0.8248 euros) Reporting by Victoria Waldersee and Andrei KhalipEditing by Mark Potter Our Standards: The Thomson Reuters Trust Principles.