The European Fund for Sustainable Development (EFSD) – the new investment fund aimed at stimulating investment in Africa and the EU's neighbouring countries – could make a decisive step towards its formal creation if the European justice and home affairs ministers manage to agree on a general approach on the proposal for a regulation to establish this new fund.
The member states' ambassadors to the EU (COREPER) met in Brussels on Wednesday 30 November and addressed the issue briefly. They are due to resume their preparatory work during the morning of Thursday 1 December. If they give the green light, an agreement, in principle, could be obtained at the Justice and Home Affairs Council on 8 and 9 December, before being sent to the foreign affairs ministers on 12 December.
The EFSD forms the first pillar of the European External Investment Plan (EIP) – the launch of which was announced by Commission President Jean-Claude Juncker last September in order to raise €44 billion in investments until 2020, primarily in the ACP Group's African regions, but also in the EU's neighbouring countries, by involving the private sector (see EUROPE 11624).
The EFSD comes within the framework of the EU's partnerships with targeted countries to stem the migration crisis (see EUROPE 11567). It will involve two regional investment platforms (Africa and the EU neighbourhood) which will combine existing mixed instruments and which will serve as a one-stop shop for receiving proposals from financial institutions and other public and private investors.
The EFSD will also provide for a new guarantee that will be transmitted to the intermediary financial institutions. These partners will bring their support to the ultimate recipients through loans, guarantees, own funds or similar products.
The EFSD Guarantee will reduce the risk run by private investors and will absorb the potential losses suffered by eligible partners, such as public finance institutions and investors from the private sector. Management of the fund will be ensured by the Commission.
The proposal for a regulation on the creation of the EFSD, and establishing the EFSD Guarantee and the EFSD Guarantee Fund, has been submitted to COREPER for examination. (Original version in French by Aminata Niang)