European Commission President Jean-Claude Juncker focused on more investment for European infrastructure in his first post-Brexit State of the Union speech.
At the heart of his address was his proposal to double the firepower and extend the duration of last year’s European Fund for Strategic Investments. “We will make sure that our EFSI will provide a total of at least €500 billion of investments by 2020. And we will work beyond that to reach €630 billion by 2022,” Juncker said.
The €315 billion fund, he added, had already catalysed some €116 billion in investments across 289 projects “from Latvia to Luxembourg” during its first year in operation, creating 100,000 jobs and lending to over 200,000 small firms and start-ups across Europe.
The EFSI is currently backed by €16 billion in guarantees from the EU budget plus an additional €5 billion from the European Investment Bank. It hopes to leverage that initial capital some 15 times, attracting capital from institutional investors and other long-term capital providers to provide over €300 billion to fund infrastructure projects across the EU.
Energy, particularly clean energy, will receive about 23 percent of the EFSI’s investments, with 12 percent going towards the EU’s digital agenda, which includes spreading broadband across the continent, among others.
Some of that ESFI money has also started to make its way into several infrastructure funds. Swiss sustainable manager SUSI Partners, for example, received a €62 million commitment from the EIB guaranteed by the EFSI for its second renewables fund; and French fund manager Cube Infrastructure scored €100 million for the maiden close of its second infrastructure fund.