The European Investment Bank (EIB) is determined to play its role as the bank of the European Union in the management of the InvestEU fund, which is designed amongst other things to replace the European Fund for Strategic investments (EFSI), post-2020.
“We are prepared to be part of this process (…). We are a banking institution and we intend to play this role in the framework of InvestEU as well”, said the President of the EIB, Werner Hoyer, on Wednesday 18 July, presenting the results, described as positive, of the 'Juncker' investment plan, which will remain in place until 2022.
The EIB has made its concerns clear to the Commission on a number of occasions. Whilst it manages the EFSI fund (see EUROPE 11924), the financial arm of the 'Juncker' investment plan, in its entirety, the management of the InvestEU fund will be devolved to the Commission in cooperation with the EIB, the national development banks and international financial bodies, according to the proposal tabled in early June (see EUROPE 12035).
The EU bank's position is this would be tantamount to giving the Commission a banking role. This would pose problems of governance, risk, overlapping of competences and poor design of financial products.
Discussions that have been described as constructive are underway between the Commission and the EIB to reach a solution and the EIB is mobilising to get its position across to the European Parliament, Council of the EU and the permanent representatives of the member states to the EU.
According to the President of the Commission, Jean-Claude Juncker, the European investment plan will exceed its target of drawing down €315 billion in additional private investments between 2015 and 2018. He referred to a few specific examples of projects supported by the fund, such as the integration of migrants in Finland, the creation of a wind farm in Greece and broadband Internet access in 15 million homes across several countries.
Hoyer said that Greece, Estonia and Lithuania were the three main beneficiary member states of the 'Juncker' plan. He went on to say that the EFSI fund had “changed the DNA” of the EU bank: it is now the responsibility of the EIB, which manages the public guarantee granted by the EFSI, to absorb the first financial losses if the project fails to go according to plan. He also stressed that from the point of view of the EU budget, which partly finances the public guarantee, there has been a sea change from a subsidy logic to one of guaranteed loans.
The Commission anticipates that the InvestEU fund will award €650 million between 2021 and 2027 by building up a public guarantee of €38 billion. (Original version in French by Mathieu Bion)