The European Union has made a further step towards a ‘megabit society.’ As pledged in a report in September, the European Commission, together with the European Investment Bank, announced on Monday 12 December that they are setting up a Connecting Europe Broadband Fund, which will finance projects in badly-connected regions of Europe.
The Connecting Europe Broadband Fund should raise at least €500 million at first closing through commitments from private and public investors, including the EIB and the European Commission. The European Commission will invest €100 million into the Fund from the Connecting Europe Facility. This fund will be open to participation of national public bodies and institutions (NPBIs). KfW Bankengruppe, Cassa Depositi e Prestiti and Caisse des Dépôts et Consignations, the three largest European NPBIs, have already expressed their interest in a possible contribution.
The Connecting Europe Broadband Fund aims to invest in equity and quasi-equity, including mezzanine and subordinated debt, in some seven to 12 broadband projects each year from 2017 to 2021. The Fund's investments will be of a size between €1 million and €30 million, for projects representing total costs of €150 million or less. Overall, the Fund is expected to unlock additional investments between €1 billion and €1.7 billion in broadband deployment in underserved areas, where very high-capacity networks are not deployed yet. The Fund aims to have invested in 20 countries by 2021.
The creation of this fund, one of the first investment platforms of the European Fund for Strategic Investment (EFSI), has been welcomed by FTTH Council Europe, an industry organisation promoting deployment of fibre optics down the chain to subscribers. (Original version in French by Sophie Petitjean)