During its plenary session of 9 March, the European Parliament adopted the InvestEU programme as part of the €750 billion Next Generation EU recovery package, with 496 votes in favour, 57 against and 144 abstentions. The programme has built on the work of the previous European Fund for Strategic Investment, which exceeded its target of attracting 500 billion euros in public and private investments for projects across the EU by the end of 2020. Starting from a limited amount of resources from the EU budget, the plan succeeded to offer guarantees to the European Investment Bank so that the bank would take on riskier projects than usual and thus encouraging other investors to get involved.
Similarly, InvestEU will establish an EU guarantee of about €26.2 billion that will allow investment partners to take on higher risks and support projects they might have otherwise ignored. To address the challenges posed by the Covid-19 crisis and the renewed EU long-term goals of a green and digital future, the new programme should contribute to EU’s long-term priorities, attracting more than €372 billion in investment. InvestEU is a flexible tool that will allow member states to plan on how to use their funds and not just be mere end users.
Key Interest Areas
It will focus on four key areas of interest:
- Sustainable infrastructure: Financing projects in digital connectivity, the circular economy, waste management, and other environment infrastructures.
Total budget: €9.9 billion;
- Research, innovation and digitalisation: Financing projects in research and innovation, digitisation of industry, scaling up larger innovative companies, artificial intelligence and more.
Total budget: €6.6 billion;
- Small and medium-sized enterprises: Facilitating access to finance for small and medium-sized companies (SMEs), small mid-cap companies, including capital support for SMEs that encountered financial pressure as a result of the Covid-19 crisis.
Total budget: €6.9 billion
- Social investment and skills: Financing projects in skills, education, training, , social innovation, healthcare, long-term care and accessibility, microfinance, social enterprise, integration of migrants, refugees and vulnerable people, and more.
Total budget: €2.8 billion
All four policy areas will support the just transition towards climate neutrality in the EU, with at least 30% of all investments going towards meeting the EU climate objectives. Moreover, investment projects that receive EU support will be screened to determine whether they do harm to the environment. Just when the EU needed public and private investments to become more competitive, productive and to boost its territorial cohesion, Invest EU will bring in additional funds to turn projects that otherwise would not have been funded, helping the regions that suffered the most, and EU citizens that deserve investment and high-quality jobs.
Composition of InvestEU
InvestEU will count on three important tools to achieve its targets:
- The Fund will combine 13 centrally managed EU financial instruments and the European Fund for Strategic Investments into one agile instrument.
- The Advisory Hub provides assistance with the preparation, development, structuring and implementation of investment projects, including capacity building.
- The Portal will bring together investors and project promoters on a single EU-wide platform, providing a database of investment opportunities available within the EU.