France welcomes Juncker Plan’s smashed investment target

European Union – Investment policy – France welcomes the positive results of the Juncker Investment Plan – Communiqué issued by the Ministry of the Economy and Finance

Paris, 19 July 2018

Bruno Le Maire, Minister of the Economy and Finance, hails yesterday’s announcement by the European Commission and the European Investment Bank that the Juncker Plan has reached and exceeded its target of raising €315 billion of extra finance in three years. The Juncker Plan is based on an innovative financial system and has enabled investment to be given a new boost post crisis in sectors key to the future of our economy, particularly the energy transition and innovation.

Bruno Le Maire says: “The Juncker Plan has supported, in a wide variety of sectors, the financing of projects which probably wouldn’t have come into being otherwise. France is the Plan’s number one beneficiary. We support it being extended in the years to come. It is an important component of our investment policy and clearly demonstrates the added value of economic action on a European scale.”

Background

The Juncker Plan is backed by a budget guarantee from the EU: €26 billion from the European Fund for Strategic Investments (EFSI) coupled with a €7.5 billion contribution from the European Investment Bank (EIB), both of which, through a leverage effect, aim to raise €315 billion of investment by the middle of 2018 to reach €500 billion by 2020. This mechanism allows the EIB to deploy financial instruments (loans, guarantees, acquisitions of stakes) in risky projects. To date, €334.8 billion has been raised as part of projects approved by the EIB in the 28 member states.

The Juncker Plan is a unique financial instrument which highlights the catalytic effect of European finance. As such it has allowed a concrete solution to be provided to the lack of investment in post-crisis Europe. The EIB has invested in innovative sectors and, thanks to the Juncker Plan, reaches many companies which had never previously benefited from its finance. Indeed, 75% of the financed projects – particularly [those of] SMEs and intermediate-sized companies – have benefited from this tool for the first time.

Since the launch in 2015, nearly 144 operations have been approved in France thanks to the guarantee provided by the Juncker Plan. This translates into more than €10 billion of EIB loans, i.e. €50 billion of extra investment. EIB documents emphasize the diversity of the operations financed throughout France: http://www.eib.org/fr/infocentre/press/releases/all/2018/2018-192-juncker-plan-exceeds-original-eur-315-billion-investment-target.htm.

In France, three sectors have received special support from the Juncker Plan, in line with the government’s priorities: the energy transition (32%), innovation (32%) and the digital sector (15%). To give an example, the EIB as such has directly financed the R&D policies of many intermediate-sized companies in the aerospace industry (Mecachrome, Latécoère and Daher) and the industry dealing with the energy-efficiency renovation of houses and flats, where the EIB provided finance for companies such as Sunpartner, which designs transparent photovoltaic windows./.

Published on 23/07/2018

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