The European Commission (EC), European Investment Bank (EIB), and the European Investment Fund (EIF) have signed a guarantee agreement, known as InvestEU, that contains nearly €20bn of funding for investment projects across the continent.
According to the EC, there will be €19.65bn of funding to support work in four policy areas: research, innovation and digitisation; small and medium-sized businesses; and social investment and skills. The EC and the EIB have also signed an agreement known as the InvestEU Advisory Hub that will provide up to €270m in funding for market development, which it says will develop skills and advisory services in the same policy areas.
InvestEU consists of three components: the InvestEU Fund, the InvestEU Advisory Hub, and the InvestEU Portal. By providing a €26.2bn EU budgetary guarantee to support finance and investment operations, the InvestEU programme hopes to attract public and private financing aiming to mobilise at least €372bn in additional investment by 2027.
Teresa Czerwińska, vice-president of the EIB, said: “Over the next six years, InvestEU will unlock much needed financing in support of businesses, innovation, infrastructure and the environment across Europe. By combining public funds with our expertise and risk-bearing capacity we can successfully mobilise large-scale investments, both public and private, that will support Europe in its recovery from the Covid-19 crisis and in the transition to a green and sustainable economy.”
According to the EC’s website, the InvestEU Fund will use public and private investment through an EU budget guarantee of €26.2bn that backs the investment projects of the EIB group and other financial partners, and increases their risk-bearing capacity. The EU says that it builds on its previous work known as the Investment Plan for Europe, which reportedly mobilised more than €500bn between 2015 and 2020.
The predicted impact of InvestEU is said to be immense. According to the EIB’s website, it will have supported €240bn in investment, added 1.1% to EU GDP, and created 1m jobs by 2024.