The promotion of recovery, carbon neutrality, employment and well-being across Europe is one of the EU’s top priorities, as well as supporting investments that deliver real benefits particularly at a local or regional level.
On the 18th of March, the European Commission held an online public event to mark the launch of the InvestEU Programme, an ambitious plan which has been developed to provide long-term funding to companies and to support EU policies during the period of recovery from a deep economic and social crisis. For the period 2021-2027 InvestEU has been designed to make the allocation of resources more efficient and make it easier to attract private investment to the programme.
What is the InvestEU Programme?
The InvestEU Programme builds on the model of the Investment Plan for Europe, better known as the Juncker Plan, which mobilised more than €500bn of investment financing during the period 2015-2020. This new plan will bring together, under one roof, the European Fund for Strategic Investments and 13 other EU financial instruments.
With the aim of triggering more than €372bn in additional investment, the InvestEU Programme’s goal is to give an additional boost to sustainable investment, innovation and job creation in Europe over the period 2021-2027.
The InvestEU Programme, whose budget stems partly from Next Generation EU, will be able to provide crucial support to companies in the recovery phase following the Covid-19 pandemic. At the same time, and in line with its purpose, it will ensure a strong focus on the EU’s medium and long-term policy priorities, such as the European Green Deal, the European Green Deal Investment Plan and the Strategy on shaping Europe’s digital future.
The InvestEU Programme supports four main policy areas (also known as windows), sustainable infrastructure; research, innovation and digitisation; small and medium-sized businesses and social investment and skills.
Sustainable infrastructure
- Transport, in particular clean and sustainable transport modes, multimodal transport, road safety, renewal and maintenance of rail and road infrastructure.
- Energy, in particular renewable energy, energy efficiency and building renovation projects focused on energy savings and the integration of buildings into a connected energy source, storage, digital and transport system, improving energy infrastructure interconnection levels.
- Digital connectivity and access including in rural areas.
- Supply and processing of raw materials, space, oceans, water, including inland waterways, waste management in line with the waste hierarchy and the circular economy.
- Nature and other environment infrastructure.
- Cultural heritage, tourism.
- Equipment, mobile assets and deployment of innovative technologies that contribute to the environmental climate resilience or social sustainability objectives and standards of the EU.
Research, innovation and digitisation
- Research, product development and innovation activities.
- Transfer of technologies and research results to the market, supporting market enablers and cooperation between enterprises.
- Demonstration and deployment of innovative solutions and support to scaling up of innovative companies as well as digitisation of EU industry.
SMEs
- Access to and availability of finance primarily for SMEs, including those innovating and those operating in the cultural and creative sectors, as well as for small Mid-Cap companies.
- Possibility of capital support to SMEs that were not in difficulty in State Aid terms already at the end of 2019, but since then face significant risks due to the crisis caused by the Covid-19 pandemic.
Social investment and skills
- Microfinance.
- Social enterprise finance and social economy.
- Measures to promote gender equality skills, education, training and related services.
- Social infrastructure, including health and educational infrastructure and social and student housing.
- Social innovation, including social impact, impact investing and social outcome contracting.
- Health and long-term care.
- Inclusion and accessibility.
- Cultural and creative activities with a social goal.
- Integration of vulnerable people, including third country nationals.
What will the Programme consist of?
Three crucial components of the InvestEU Programme are the InvestEU Fund, the Advisory Hub and the Portal.
InvestEU Fund
The InvestEU Fund is a fund that will bring together many EU-level financial instruments. It will offer more simplification, being based on a single regulation and agreement with different implementing partners (EIB Group, National Promotional Banks and Institutions, International Financial Institutions, etc.). The InvestEU Fund aims to mobilise more than €372bn of public and private investment through an EU budget guarantee of €26.2bn that will support the investment of its implementing partners. It will also offer advisory services.
InvestEU Advisory Hub
The InvestEU Advisory Hub will be managed and hosted by the European Commission and will be available through the InvestEU website, as soon as the advisory agreements are signed. The Advisory Hub will provide technical support and assistance to help with the preparation, development, structuring and implementation of investment projects, including capacity building.
InvestEU Portal
The InvestEU Portal will bring together investors and project promoters on a single EU-wide platform, by providing an easily-accessible and user-friendly database of investment opportunities available within the EU.
Paolo Gentiloni, the EU Commissioner for the Economy, said that the InvestEU Programme will not only boost future-oriented investments across the European Union, but it will also provide crucial support to businesses, helping the economy to overcome the effects of the Covid-19 crisis.
How is this relevant to the SBCI?
75% of the €26.2bn EU guarantee (see InvestEU Fund) will be available through the EIB Group, while the remaining 25% will be directly accessible to all other implementing partners, which have specific financial or sectorial expertise, deep knowledge of their local market or greater capacity to share risk with the EU in some areas. In order to qualify as an implementing partner, NPBIs must undergo a thorough Pillar Assessment and meet a series of specific requirements in areas such as internal controls system, accounting system, external audit and procedures for providing financing from EU funds through grants, procurement and financial instruments.
The SBCI is currently undergoing the Pillar Assessment process and expects to achieve the “Implementing Partner Status” in the coming months. This will allow the SBCI to directly access the EU guarantee and give further flexibility to the development of new funding supports for Irish SMEs and farmers.
by Arianna Taroni and Ultan Brady