European Parliament plenary vote marks green light for EFSI 2.0
Today Members of the European Parliament voted to adopt the Regulation to extend and enhance the European Fund for Strategic Investments (EFSI), the central pillar of the Investment Plan for Europe. This successful final step follows the agreement in principle reached by the European Parliament and Member States on 13 September.
European Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: “The Investment Plan has brought real benefits to companies across Europe. And we want to do more. We listened to the feedback we received on how the European Fund for Strategic Investments works and we have made some improvements. We are making the EFSI’s investment decisions even more transparent and providing more technical support at a local level. We are also extending the EFSI’s lifetime to end-2020 and its investment target to €500 billion. The EFSI has already helped create 300,000 jobs – let’s keep up the momentum”.
“When we first announced it, the EFSI was met with some scepticism,” said European Investment Bank President Werner Hoyer. “Over the last two and a half years we proved that this initiative has delivered – it supported thousands of companies and created hundreds of thousands of jobs. I am proud that the EIB Group’s expertise played such an important role in Europe’s recovery and I am very pleased that, via today’s extension of the EFSI, we are given the chance to do even more.”
The EFSI 2.0 Regulation is expected to enter into force on 1 January 2018. As well as extending the timeline from mid-2018 to the end of 2020, and increasing the investment target from €315 billion to at least €500 billion, the new and improved EFSI has the following features:
Under the new EFSI, the Investment Committee will publish their decisions online, showing the reasons why they chose a project to receive support from the EU budget guarantee. The scoreboard of indicators will be published after the signature of each EFSI project. The new Regulation also gives a more detailed definition of what makes a project eligible for EFSI support, so-called “additionality”.
Larger proportion of sustainable projects
At least 40% of EFSI infrastructure and innovation projects will aim to contribute to climate action in line with the Paris Agreement. EFSI 2.0 also explicitly targets new sectors: sustainable agriculture, forestry, fisheries and aquaculture.
Greater focus on small projects
Given the success of the EFSI in supporting small companies, with 528,000 SMEs already set to benefit as of November 2017, the extended EFSI will increase the proportion of the guarantee for SMEs from 26% to 40%. The new EFSI also encourages the EIB Group to help national promotional banks set up investment platforms to bundle several small-sized projects by theme or by region in order to attract investors.
More technical support at the local level
The European Investment Advisory Hub, which is jointly managed by the Commission and the EIB, is proving a useful resource for businesses in need of technical support to get their project off the ground. In EFSI 2.0, the work of the Hub will be enhanced by providing more tailor-made assistance on the ground and working in close cooperation with national promotional banks.
Improving the business environment in the EU
As the Commission’s Autumn Forecast and the EIB’s investment report recently showed, the investment levels in the EU are gradually increasing. However, they are still not at pre-crisis levels. In its Work Programme for 2018, the Commission announced it will carry out a full assessment of what has been done to improve the business environment and bring down investment barriers since the start of the Juncker Commission, both at EU level and in the Member States.
Compliments of the European Investment Bank