THE INVESTMENT PLAN FOR EUROPE - EUROPEAN FUND FOR STRATEGIC INVESTMENTS (EFSI) EUROPEAN INVESTMENT ADVISORY HUB (EIAH) EUROPEAN INVESTMENT ...
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THE INVESTMENT PLAN
FOR EUROPE
EUROPEAN FUND FOR STRATEGIC INVESTMENTS (EFSI)
EUROPEAN INVESTMENT ADVISORY HUB (EIAH)
EUROPEAN INVESTMENT PROJECT PORTAL (EIPP)
IMPROVED INVESTMENT ENVIRONMENT
Agenda
European economic context
Investment gaps
The Investment Plan for Europe: key features and status
Pillar 1. Mobilising finance for investment
Pillar 2. Making finance reach the real economy
Pillar 3. Improved Investment environment
2
EU economic context
The European economy is in its fifth year of recovery. which is now
reaching all EU Member States. This is expected to continue at a largely
steady pace this year and next.
Very accommodative monetary policy has set the scene for a pick-up
in investment by making access to funding easier and cheaper. Fiscal
policy in the euro area is expected to be supportive of growth this year.
The moderate pace of improvement in labour markets is expected to
continue. EU unemployment is expected to fall from 9.4% in 2017 to
8.9% in 2018. Its lowest level since the start of 2009.
The economies of all Member States are expected to expand next year,
but investments and jobs are still expected to remain uneven across the
EU.
Euro area GDP growth: 1.7% in 2017 and 1.8% in 2018
Source: European Commission, Spring Economic Forecast, 2017
3
EU economic growth
Steady growth ahead.
Source: European Commission, Spring Economic Forecast, 2017
4
EU economic policies
Sustaining and strengthening the economic recovery:
• 1. boost investment
• 2. pursue responsible public finances
• 3. structural reforms to enhance competitiveness.
5
Investment gap: EIB analysis
• Productivity growth in EU < US since mid-1990s
• Additional investment estimated by EIB:
+ € 130bn/y in R&D to meet EU target of 3% of GDP
+ € 100bn/y to upgrade Energy networks
+ € 80bn/y to upgrade Transport networks
+ € 65bn/y to reach EU Digital Agenda standards
+ € 10 bn/y for state-of-the-art Education facilities
+ € 90 bn/y to rehabilitate Environmental services and Water
+ € 35bn/y in VC financing to match US levels of VC/GDP
• Most of these needs have to be translated into concrete investment
projects:
Structural reforms, Policies to address market inefficiencies, Advisory, Risk-
taking.
Source: EIB, "Restoring EU competitiveness", Jan-2016
6
Why an Investment Plan for Europe?
Investment & competitiveness gap
Investment Plan for Europe
High liquidity in the market • EU and Member State policy
action
• EU budget guarantee
Public budget constraints • EIB capacity to mobilise
additional investment
Financial and non-financial barriers
to investment
7
The 3 pillars of the Investment Plan for Europe
1. MOBILISING FINANCE 2. MAKING FINANCE
FOR INVESTMENT REACH THE REAL ECONOMY
Mobilise at least €315bn over 3 years for strategic European Investment Project Portal (EIPP)
investments and access to finance via the European European Investment Advisory Hub (EIAH)
Fund for Strategic Investments (EFSI) within EIB/EIF
Cooperation with National Promotional Banks
3. IMPROVED INVESTMENT ENVIRONMENT
Predictability and quality of regulation
Removing non-financial, regulatory barriers
in key sectors within EU Single Market
Structural reforms at national level
8
1. European Fund for Strategic Investments (EFSI)
EFSI risk-bearing capacity EIB
EU Budget
€ 21 bn Own resources
Guarantee
x3
Other financiers EIB / EIF financing
(private sector, NPBs,...) € 61 bn
x5
SME
Infrastructure
window
& Innovation
window
Investments value over 3 years
(mid 2015-mid 2018)
€ 315 bn
9
EFSI value added: making a difference
Addressing Financing Absorbing part of
market failures or operations not the risk to trigger
sub-optimal possible to same additional
investment extent otherwise investments
situations
Impact orientation
Attracting other
Enhancing Supporting
sources of
growth employment
finance
10European Fund for Strategic Investments
11Examples of EFSI operations
Financing for a French SME guarantee
pioneering programme agreement
EUR 400m to Unlocking EUR
trigger energy 100m of loans for
efficiency investments
in private homes 1 000 SMEs in
Bulgaria
Driving clean For energy Backing Supporting
energy efficient midcap smaller
investment buildings modernisation businesses
Equity-type financing Funding cutting-edge
for an innovative fund steel production
facilities in Italy
EUR 75m for
investment in offshore EUR 100m for
wind, biomass and innovative and
transmission projects competitive steel
in Denmark products
12Example of EFSI operation financed by EIB
Driving clean
energy investment
EIB participation in an
innovative fund is
mobilising some
Equity-type financing
for an innovative fund EUR 2bn of investment
EUR 75m for in offshore wind,
investment in offshore biomass and
wind, biomass and
transmission projects
transmission projects in
Denmark
13Example of EFSI operation financed by EIF
Supporting smaller
businesses
An EIF guarantee
agreement is helping
Equity-type financing to unlock EUR 100m
for an innovative fund
of loans for some
EUR 75m for
investment in offshore 1 000 SMEs in
wind, biomass and Bulgaria
transmission projects
14EFSI type of instruments
Continuously adapting to market needs
15EFSI setup and governance
EIB
EFSI
Group
All EFSI operations are financed by the EIB Group (EIB&EIF)
• On the EIB Group’s balance sheet (no separate entity)
• Subject to standard due diligence
• EIB & EIF governing bodies approve each operation
EFSI governance:
• Steering Board
• Investment Committee, headed by a Managing Director
Operations already started in spring 2015
16EFSI key areas
Operations to be consistent with EU policies and to support
any of the general objectives:
1. Research, development and innovation
2. Energy (ref. Energy Union priorities)
3. Transport
4. Information and Communication Technologies
5. Environment and resource efficiency
6. Human capital, culture and health
7. Support to SMEs and mid-cap companies, through local
partner banks and institutions
17Key features of EFSI
Focus on investments in real economy
Results on growth and jobs
Market-driven, no political interference
No geographic or sector pre-allocation
Leverage / crowd-in private sector and third parties
Economic and technical viability
Additionality
Market failures and sub-optimal investment
Higher risk-taking than EIB normal activity in EFSI timeframe
Pricing in line with EIB policies
18Key features of EFSI
Size of investments
EIB uses min €25m for individual loans
Smaller schemes can be grouped into framework loans
No size restriction for operations via Fin. Intermediaries (e.g. for SMEs)
Geographic scope
EU28
Projects involving an entity in a MS and extending to Enlargement
(Western Balkans, Turkey), EU East/South Neighbourhood, EEA/EFTA
(Norway, Switzerland, Liechtenstein), Overseas Countries and
Territories.
19Who can benefit?
Eligible counterparts
SMEs
Utilities and
Corporates of all public sector (up to 250
sizes entities employees) or
midcaps
(non-sovereign)
(up to 3 000)
Contact
EIB Group directly
National via InfoDesk or
Promotional Dedicated relevant
Banks or other Investment Operations
banks for Platforms Department
intermediation www.eib.org
www.eif.org
20EFSI Infrastructure & Innovation financing: step-by-step
21EFSI SME financing
22EFSI investment platforms
Pooling of projects with thematic or geographic focus
Flexible form: co-financing agreement, SPV, Fund, etc.
Useful to pool small projects
Can benefit from the EU Guarantee via the EIB
Cooperation with EU National Promotional Banks (NPBs)
Rules on operations with NPBs and Investment Platforms
approved
Guidance brochure by the Commission and the EIB available at
http://ec.europa.eu/economy_finance/financial_operations/documents
/efsi_rules_applicable_to_operations_en.pdf
Interest by institutional investors, third countries and Sovereign
Wealth Funds
23EFSI in combination with EU funds
MS may use EU funds to co-finance EFSI projects.
ESIF (European Structural and Investment Funds) programmes
may contribute to the achievement of the objectives of the
Investment Plan and be complementary to EFSI support, so as to
ensure higher value-added and leverage:
at Project level
at Investment Platform level
Guidance Brochure by the Commission available at
ec.europa.eu/regional_policy/sources/thefunds/fin_inst/pdf/efsi_esif_
compl_en.pdf
24EFSI scoreboard
25EFSI: next steps
• Building the EFSI pipeline -> high priority
• Further efforts to accelerate new products and setting-up
Investment Platforms
• Proposal to extend EFSI 2.0 until end 2020
• Mobilize at least € 500bn
• Link to COP21 targets
• Reinforce additionality
• Enhance geographical coverage - cross-border projects
• Reinforce technical assistance
262. Making finance reach the real economy
Transparency on investments in Europe
European Investment Project Portal (EIPP) - www.ec.europa.eu/eipp
Matching investment opportunities proposed by project promoters
with investors' interest.
Live as of June 2016.
Strengthening advisory services
European Investment Advisory Hub (EIAH) by EC/EIB
www.eib.org/eiah
Technical assistance.
Pooling Commission and EIB resources & expertise including from
MS.
27European Investment Project Portal
ec.europa.eu/eipp
Bridge between EU's investment opportunities and potential investors.
A web portal that enables EU-based project promoters (public and private
authorities) to share their investment proposals seeking external financing,
in a transparent way.
Investors can search for opportunities across Europe (size, sector,
geography).
Project promoters may submit projects @ ec.europa.eu/eipp
Publication of a project is free for public entities.
More than 100 projects already published on the Project Portal (as of end of
August 2016)
28EIPP – eligibility criteria
EIPP projects should:
1. have a minimum size of EUR 3 million;
2. fall within one of the sectors/areas listed in Article 9(2) of Regulation (EU)
2015/1017;
3. be compatible with Union law and the law of the relevant Member State;
4. be expected to start within three years from submission to EIPP;
5. project promoter should be a legal entity established in an EU Member State
(individuals cannot submit EIPP projects); and
6. publication of a project can be denied if the information is inaccurate or if its
publication may entail legal or reputational risks for the European Commission or
the Member States, or both.
29EIPP Find projects
30European Investment Advisory Hub (EIAH)
DEMAND
Project promoters Public authorities Member States Private sector
Access point
Web content + Web portal + Support team
European Investment Advisory Hub
Existing advisory Additional advisory and EIAH’s partner
programmes and activities technical assistance institutions’ expertise
Delivery channels
Project support throughout the New investment support also Network of institutions incl.
project cycle in areas relevant to the scope EIB Group, European
Support to Financial of EFSI (could be delivered by Commission , National
instruments EIB advisory or operational Promotional Banks, etc.
Enhance access to finance teams) Integrated collaboration model
Identification of needs as they
arise
SUPPLY
18
31What is the European Investment Advisory Hub (EIAH) ?
A joint initiative by the European Commission and
the European Investment Bank
A tool to strengthen Europe's investment and
business environment
A single access point to a 360 degree offer of
advisory and technical assistance services
A cooperation platform to leverage, exchange and
disseminate expertise
An instrument to assess and address unmet needs
for advisory support
32EIAH: a 360 degrees advisory offer
TYPE OF SUPPORT DESCRIPTION EXISTING PROGRAMMES EIAH SERVICES
Support for projects and Advisory and technical support in JASPERS, ELENA, EPEC,
investments identification, prioritisation, Implementation support
preparation, structuring and programmes Additional Technical Assistance
implementation of investment support to the already existing
projects technical assistance services
Enhance use of EU funds Advisory and capacity building fi-compass, bilateral services to provided to project promoters and
support in the implementation of Managing Authorities managing authorities to develop
ESIF financial instruments economically and technically viable
projects as well as improve the use
Improve access to finance Enhancement of the overall Innovation Finance Advisory of EU funds.
conditions for financing for public
New advisory services: Continuous
and private beneficiaries
development of the Hub’s advisory
offer to address unmet needs
Access to the expertise of The Advisory Hub is also expected
the Hub’s local partners to coordinate a network of National
Promotional Institutions and
Managing Authorities. Together,
Advisory and technical support from the Hub’s local network the Hub’s partners can deliver a
comprehensive and complete
advisory services offer.
33Opportunities for third parties
Private companies
EFSI Individual projects: request financing to EIB Group
EFSI Investment Platforms: submit projects for financing
EIAH: request advisory / technical assistance for projects
EIPP: submit projects to the Portal to attract investors
Investors and financing institutions
EFSI Individual projects: cofinancing with EIB
EFSI Financing to SMEs: request guarantee to EIF or credit line to EIB
EFSI Risk capital for Start-ups/SMEs: request equity financing to EIF
EFSI Investment Platforms: act as sponsor/financier
EIPP: explore opportunities to finance investments in Europe
34Opportunities for third parties
Third countries / sovereign investors
• Understand opportunities of the Investment Plan for Europe
• Exchange of views / learning
• Enhance investment policies at country/regional/global level
• Explore possibility to cofinance EFSI projects with EIB Group
• individual projects
• Investment Platforms: portfolio approach
• Promote EIAH and EIPP with stakeholders in third country
35EIAH: would you like to know more?
Consult the Hub’s
www.eib.org/eiah
advisory offer
Request support from
www.eib.org/eiah/contact
the Hub
Contact the Hub for
eiah@eib.org
more info
20
363. Improved Investment environment
• Better and more predictable regulation at all levels
• Making most of the Single Market
• Structural reforms in the Member States
• Openness to international trade and investment
37Making most of EU Single market
Single Market Strategy
Support start-ups, remove barriers to firms and services
Energy Union
Transition to low-carbon economy (RE/EE), energy market,
interconnections.
Digital Single Market
Level playing field, improved access to digital goods and services,
harmonisation of rules
Capital Markets Union
Reduce fragmentation, reduce cost of funding esp for SMEs, amend
Solvency II
Single European Transport Area
38Structural reforms in Member States
Annual Growth Survey (EC, Nov-2015) – country fiches on MS investment challenges, to be
reviewed in European Semester
1) Public administration / business environment
• Regulatory barriers and administrative burden; Public administration; Public procurement
/PPPs;
• Judicial system; Insolvency framework; Competition and regulatory framework
2) Labour market / education
• Employment protection legislation & framework for labour contracts
• Wages & wage setting; Education, skills, lifelong learning
3) Financial sector / taxation
• Taxation; Access to finance
4) Research, development and innovation
• Cooperation between academia, research and business ; Financing of R&D&I
5) Sector specific regulation
• Business services / Regulated professions ; Retail; Construction; Digital Economy /ICT;
Energy; Transport
39InvestEU: status and next steps
Status
EFSI regulation entered into force in Jul-15.
Guidance on ESIF/EFSI combination; Rules for Investment
Platforms/NPBs approved in Feb-16.
EIAH operational since Sep-15.
EIPP launched in Jun-16.
EFSI SME window scaled up.
Next steps
Make full use of instruments: EFSI, ESI Funds, EIAH, EIPP.
Reinforced EFSI after mid-2018.
Single market priorities. European semester.
Reapplication of plan outside the EU -> European External Investment
Plan (EIP)
40Thank You - Would you like to know more?
#InvestEU
Investment Plan for
www.ec.europa.eu/invest-eu
Europe
www.eib.org/invest-eu
www.eib.org/efsi
www.eif.org/what_we_do/efsi
EFSI
Contact for promoters: info@eib.org or relevant EIB
Operations department
www.eib.org/eiah
EIAH eiah@eib.org
EIPP www.ec.europa.eu/eipp
20
41BACK UP SLIDES
42EFSI: mobilising new investment
43EFSI reporting
44EFSI timeline and investment period
2015 2016 2017 2018 2019 2020
4 July 4 July 30 June
4 July
1st 2nd
Deadline
deadline deadline
Entry into Third anniversary for
for for
force of of signing the approval of
signature signature
EFSI EFSI Regulation EFSI
of EFSI of EFSI
Regulation Operations
operations Operations
Investment period to achieve EUR 315bn of total investments “Extended” investment period
EFSI operations to target EUR 315bn of total investment by 2018
Actual investment period runs until 30 June 2020
45
27EFSI governance
STEERING BOARD INVESTMENT COMMITTEE
sets the strategic orientations, 8 independent experts selected by the Steering Board for their competence in project financing
operating policies, rules applicable to
operations with NPBs and Investment Approves or rejects the support of the EU guarantee for EFSI projects on the basis of the EFSI
Regulation and the scoreboard of indicators
Platforms, and the risk profile of the
EFSI Dominik Gillian Thierry
Radziwill Day Déau
3 members from the Commission
(Gerassimos Thomas, Irmfried
Schwimann, Benjamin Angel)
1 member from the EIB
(Ambroise Fayolle) Dalia Nievez Noel Gregor
Dubovske Rodriguez Patterson-Jones
MANAGING DIRECTOR AND
DEPUTY MANAGING DIRECTOR
MD (Wilhelm Molterer): Day-to-day
Vicky Fabio
management of the EFSI, prepares Kefalas Pammoli
and chairs the meetings of the
investment committee
dMD (Ilyiana Tsanova):
assists the MD
46EFSI Infrastructure and Innovation Window
SOURCES TYPICAL PROJECTS IN
OF FUNDING PRODUCTS ELIGIBLE SECTORS
OFFERED
The Fund Other Research, Development,
serves as investors Innovation
Long-term senior
credit debt for higher join in on Energy infra, Renewable
protection for risk projects a project Energy, Energy Efficiency
new EIB basis
activities Transport
European Fund
for Strategic Subordinated loans
ICT
Investments
Environment and
Resource efficiency
Equity and
quasi-equity Human capital and social
sectors
SMEs
47Example of EFSI projects
Innovative renewable energy infrastructure fund in
Denmark
• EIB, backed by EFSI, provides equity-type financing of up to EUR 75m to
Copenhagen Infrastructure Partners for an innovative infrastructure fund
investing in large energy-related projects such as offshore wind, biomass
and transmission schemes.
• EIB's equity participation would contribute to the fund’s overall market
credibility with institutional investors and help broaden its investor base to
an international one.
• The anticipated high share of offshore wind, biomass and transmission
investments is expected to generate considerable employment in the
construction phase (2500 - 4000 jobs). It is also estimated that some 1000
jobs may be created during the project’s operation, a significant number of
which will be highly-skilled jobs.
48Example of EFSI project
Energy efficiency in residential buildings in France
The EIB, backed by EFSI, provides a €400m loan to a pioneering financing
programme aimed at addressing the need to trigger energy efficiency investments
in private homes in France on a large scale.
The project supports an innovative approach by French regions to set up
specialised companies to provide a ‘packaged’ solution covering technical and
financial assistance to homeowners for retrofitting.
The project is expected to support retrofitting of some 40 000 flats and houses.
Energy efficiency investments will benefit the economy by cutting energy bills,
saving emissions and creating new construction jobs
(c. 6 000). Total energy savings are estimated to be of the order of
288 000MWh per year. This is roughly equivalent to the annual energy
consumption of 9 600 French households.
49Example of EFSI projects
Accessibility Ports Infrastructure (Spain)
The project concerns the financing of the Fondo Financiero de Accesibilidad Terrestre
Portuaria (FFATP), to support investments in accesses via rail and road to the main national
ports during 2015-2020. The project will improve interoperability between transport modes in
the TEN-T network as all ports are TEN-T and in Cohesion Priority Regions.
The majority of schemes contribute to Climate Change through Sustainable Transport
objectives.
Third party financing required in order to complete the financing needs.
Financing from the EIB will accelerate the construction of projects and will act as a catalyst for
the participation of the Spanish NPB (ICO) and commercial banks.
Transport rolling stock (Italy)
Innovative financing structure (bond scheme) under EFSI for the acquisition of 49 five-car
articulated EMUs and 250 double-deck passenger coaches.
New rolling stock will be used in 5 regions, concentrating 50% of the service supply and 60%
of the entire Trenitalia’s patronage.
Delivery of new rolling stock: 2014 – 2016
Project Investment Cost: € 709m
Loan amount: € 300m
50EFSI SMEs and Mid-caps window
SOURCES TYPICAL FINAL RECIPIENTS
OF FUNDING PRODUCTS AND EXAMPLES
OFFERED
The Fund Other e.g. equity
serves as investors in a
credit Venture Capital join in on start-up
protection for a project SME
new EIF basis e.g. micro-
activities loans to
European Fund Guarantees a SME
for Strategic
Investments
e.g. loans
Securitisation for R&D
project
Mid-cap
company e.g.
Growth finance venture
capital for
a prototype
51Example of EFSI-backed EIF operation
EIF and Bpifrance sign first agreement for innovative French
companies
•Under the agreement, Bpifrance will provide finance to innovative companies in
France for a total of EUR 420 million over the next two years with support of EFSI,
allowing EIF to provide a new financing boost for highly innovative businesses under
the Horizon 2020 initiative InnovFin, the EU's Finance for Innovators.
•Bpifrance has recently launched a product called "Prêt d'Amorçage investissement"
("PAi") to address the needs of start-up companies. It will combine this product with
the EU guarantee at a 40% guarantee rate.
52Example of EFSI-backed EIF operation
EIF and BGK sign first COSME agreement in Europe
to benefit Polish businesses
•The agreement will provide BGK with a counter-guarantee allowing to support PLN
1,000 million (ca. EUR 250 million) of loans to SMEs in Poland over the next two
years with the support of EFSI.
•The loans will be provided without hard collateral thanks to a 80% guarantee which in
turn is backed by a counter-guarantee from the EIF, provided under the COSME
programme with financial backing from the EU.
•The agreement will make it possible for BGK to launch a new guarantee product and
to support additional financing without requiring hard collateral (e.g. mortgage) at
favourable conditions to approximately 5,000 SMEs.
53FAQs about EIAH
What is the geographical scope of The European Union
the Hub?
No, support will not be limited to projects to be financed
Is the Hub linked to EFSI projects
by EFSI (and/or the EIB)
only?
Does the Hub provide financing? No
Who concretely delivers the Experts of the Hub, its partner institutions and/or
advisory support provided via the appointed external consultants
Hub?
In most cases, yes. A contribution may be requested
Is the support provided via the Hub
from certain private beneficiaries in order to align
free of charge?
interests and ensure ownership of results
Currently the Hub operates mainly via the EIB headquarter
Does the Hub have local offices? in Luxembourg and its local offices. A network of local
partner Institutions is being established
54•Requests to the Hub: overview
•Situation as at 31.08.2016
•Requests by country
No. of
Country requests
United Kingdom 22 Total of 255 requests
Bulgaria 19
195 project-specific requests
Italy 19
Belgium 18 • Public sector: 59
Spain 17 • Private sector: 130
Romania 14
Hungary 13 • Other (e.g. NGOs): 6
Germany 13
France 12
Greece 12
The
Netherlands 9
Latvia 8 Project-specific requests by sector (Tot. 195)
Austria 8 Energy
Luxembourg 8 19% R&D/Innovatio
Czech Republic 7 n
Cyprus 7 Transport 9%
Education
Lithuania 6
2% 15% Other
Poland 6 8%
Finland 5
Slovenia 4
Croatia 4
Ireland 3
Portugal 3 Agriculture
Malta 2 5% Health Telecommuni
Slovakia 2
5% cations &
Denmark 2 Digital
Sweden 1
Urban/Rural SMEs / start 9%
Estonia 1 ups
development Environment
Total 245 12%
•*excludes 10 requests 10% 6%
from non-EU countries
•*The category “other” includes project-specific requests in which the sector is not
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