The future Competitiveness Fund was at the centre of discussions at a conference organised in Brussels on Wednesday 10 June by the European Long-Term Investors Association or ELTI. The event, devoted to the next Multiannual Financial Framework (MFF), saw several European Commission officials and a number of European leaders from various public investment banks, the ‘National Promotional Banks and Institutions’ (‘NPBIs’) set out their expectations regarding the new Fund, one of the major innovations in the 2028-2034 budget.
A number of speakers voiced concern about negotiations between the co-legislators dragging on beyond 2026, including Estelle Göger, Deputy Head of Cabinet of the European Commission Executive Vice-President Stéphane Séjourné.
“Preparing the rollout of this new Competitiveness Fund will indeed be a considerable undertaking. Unfortunately, with the gradual winding-down of the Recovery and Resilience Facility (RRF), there is a risk of a cliff edge effect. If the next MFF enters into force late, there is a risk that investment in Europe will lose momentum. In this context, we cannot afford that”, she argued.
These discussions took place while a compromise text was in fact being discussed on Wednesday around the Council of the EU table on the functioning of the Competitiveness Fund (see EUROPE 13885/4). This Thursday, it will be up to the Cyprus Presidency of the Council to unveil its negotiation box, setting out the broad budget figures. This sensitive issue will then be placed on the agenda of the EU27 leaders at the European Council on 18 and 19 June (see EUROPE 13884/30).
“We will see, when the ‘nego box’ comes out, how much money will be left [for the Competitiveness Fund]”, warned Kerstin Jorna, Director-General of the European Commission’s Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs (DG GROW). Besides the size of this new instrument, which under the institution’s initial proposal is supposed to bring together around 30% of the EU’s long-term budget, Kerstin Jorna praised the “Swiss army knife” dimension of the future Fund, which will have rolled into it, amongst other things, the InvestEU programme (see EUROPE 13677/1). “We have had grant programmes, we’ve had financial instrument programmes, and we have also had programmes intended to invest in equity. But we’ve never had an instrument capable of doing everything at once. That is precisely what the Competitiveness Fund will make possible: covering the entire investment journey”, she was pleased to say.
“I am encouraged by DG GROW’s statement (...), and although I like the image, Swiss army knives can also be complicated and dangerous”, replied Andre Kuusvek, President of the Nordic Investment Bank. “So, I think that, as regards reporting, I would say: ‘Let us not change too many things to the point of creating an entirely new system’ (...) We do not want to devote too many resources to administrative management”, he further warned.
But more broadly, the tone was largely positive regarding the Commission’s draft budget plan, in particular this Competitiveness Fund. The place it gives to the various Investment Promotion Agencies (‘IPAs’) was welcomed, as was the better understanding of their role within the EU institutions.
“I have recently noticed that, more and more, you – the Commissioners and the new teams – are seeking to interact more with us, and that is a good thing. In the past (...), certain Commission departments produced some very fine documents, but they absolutely did not correspond to market demand. That is a mistake we cannot afford to repeat”, noted Dario Scannapieco, Chief Executive Officer of Cassa Depositi e Prestiti and President of ELTI. “I think that with the European Competitiveness Fund, we have a coherent strategic framework”, he stressed, while hoping to see more of a “sense of urgency” in the ongoing negotiations.
And the Italian economist warned, with reference to the ongoing discussions in the European Parliament, that overly frequent changes to the future funds would have to be avoided, otherwise the risk would be to weaken long-term investment.
See the draft conclusions of the European Council of 18 and 19 June: https://aeur.eu/f/m8u (Original version in French by Clément Solal)