The European Investment Bank: Annual Report 2014 and outlook

26-04-2016

The European Union has not yet fully recovered from the global financial and economic crisis. GDP growth rates have begun to increase only slowly, and in most EU Member States investment activity lags behind pre-crisis levels – indicating sizable investment gaps. In fact, gross fixed capital formation in the euro area has declined by 15% since 2007. In 2014, the European Investment Bank (EIB), the EU's public bank and largest multilateral lending institution, contributed financing of €80.3 billion (including the EIF – the European Investment Fund). This was in the form of loans granted to projects in four strategic areas: Innovation and skills, smaller enterprises, strategic infrastructure, climate action, as well as to projects outside the EU. In mid-2015, the European Commission introduced the European Fund for Strategic Investments (EFSI). As a coordinated effort by the European Commission and the EIB, its goal is to provide additional risk-sharing through public funds. By mid-March 2016, €10.6 billion of public money had been allocated, with the expectation that this would generate a total investment effect of €76.1 billion. The European Parliament's Committee on Budgetary Control (CONT) reports on the work of the EIB on an annual basis. It 'welcomes' overall financing activity in 2014, but urges enhanced ex-post assessment. It regrets the lack of information on the number of projects/financial instruments related to operations supporting cohesion. While the EIB usually focuses on small numbers of large, low-risk projects, the introduction of EFSI might eventually lead to assuming more and riskier projects in the future.

The European Union has not yet fully recovered from the global financial and economic crisis. GDP growth rates have begun to increase only slowly, and in most EU Member States investment activity lags behind pre-crisis levels – indicating sizable investment gaps. In fact, gross fixed capital formation in the euro area has declined by 15% since 2007. In 2014, the European Investment Bank (EIB), the EU's public bank and largest multilateral lending institution, contributed financing of €80.3 billion (including the EIF – the European Investment Fund). This was in the form of loans granted to projects in four strategic areas: Innovation and skills, smaller enterprises, strategic infrastructure, climate action, as well as to projects outside the EU. In mid-2015, the European Commission introduced the European Fund for Strategic Investments (EFSI). As a coordinated effort by the European Commission and the EIB, its goal is to provide additional risk-sharing through public funds. By mid-March 2016, €10.6 billion of public money had been allocated, with the expectation that this would generate a total investment effect of €76.1 billion. The European Parliament's Committee on Budgetary Control (CONT) reports on the work of the EIB on an annual basis. It 'welcomes' overall financing activity in 2014, but urges enhanced ex-post assessment. It regrets the lack of information on the number of projects/financial instruments related to operations supporting cohesion. While the EIB usually focuses on small numbers of large, low-risk projects, the introduction of EFSI might eventually lead to assuming more and riskier projects in the future.