MEPs VOTE IN FAVOUR OF LOAN GUARANTEES FOR RESEARCH & INNOVATION

As the European Parliament entered its last session before the European elections in May, MEPs approved a provisional deal with the EU Council on InvestEU, under which the EU plans to guarantee €38 billion of loans and equity, including €11.25 billion for research and innovation.

By committing to repay bad loans and negative equity, InvestEU’s aim is to encourage the European Investment Bank and other financial partners to finance riskier projects than would normally be the case. The scheme will replace the European Fund for Strategic Investments (EFSI), more commonly known as the Juncker Plan, and other investment programmes. In addition to research and innovation, InvestEU will also guarantee investments in sustainable infrastructure, helping start-ups and SMEs grow, and social investment and skills.

The final budget for InvestEU remains however dependent on the negotiations over the EU’s next long-term financial plan. InvestEU is different from other programmes, in that not all of the money allocated to it is expected to be spent, since the fund will only be called upon if and when any investments it guarantees require bailing out.

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