The European Investment Bank (EIB) believes that the Juncker investment plan will reach the target of mobilising €315 billion in additional investments over three years by 2018. However, improvements are still possible regarding the geographical coverage of projects, attracting private investment and in governance matters, the European institution states in an assessment carried out a year after the European investment plan was implemented and published on Thursday 6 October.
At the end of June 2016, the projects approved under the public guarantee of the European Fund for Strategic Investments (EFSI) corresponded to around a third of the overall target for investment mobilised. As regards signatures, the progress made represents 21% of the same target. This means that the EFSI is delivering well on approvals, but is lagging a certain way behind on signatures and disbursements, the EIB notes in its report.
In 2015, the Council of the EU and the European Parliament made a conscious decision not to include geographical and sectoral criteria in the legislation instituting the EFSI, in order to avoid any political intervention in the selection of the projects. However, the geographical orientation documents of the fund set indicative frameworks to prevent excessive imbalances.
According to the EIB report, "three member states (UK, Italy and Spain) account for approximately 63% of total EFSI financing within the 'infrastructure and innovation' portfolio, exceeding the geographical concentration limit of 45% set within the EFSI's Strategic Orientation". Furthermore, not including multi-country operations, three member states (Italy, France and Germany) represent 54% of total funding under the SME portfolio of the EFSI, the authors of the report note. They go on to express concern at the fact that the overall portfolio of the EFSI focuses strongly on the Europe of 15 (92%), neglecting the Europe of 13 (8%), including countries of Central and Eastern Europe.
The EIB took pains to put this geographical imbalance in absolute terms into context. In its press release, it observes that the financing of the EIB group compared to national GDP is actually higher in the smaller European economies.
The report suggests areas in which the Juncker plan, which the Commission has already proposed to increase and extend until 2020 at least, bears improvement (see EUROPE 11624 and 11631). The sectoral coverage of the Juncker plan may be extended. Of the seven sectors in which projects benefit from the public guarantee of the EFSI, energy comes in for the lion's share, with 46% of total funding under the 'infrastructure and innovation' portfolio, even though the indicative concentration limit per sector has been set at 30%.
The EIB recommends additional efforts to increase the mobilisation of private capital. Lastly, whereas members of the European Parliament and several member states have criticised the EIB's risk-averseness in its investment decisions, the report does not criticise the European institution's performance in selecting the projects it finances. (Original version in French by Mathieu Bion)