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26th Feb 2024

EU leaders want 'urgent' action on investment fund

  • Tusk managed to wrap up the economics debate in 2.5 hours (Photo: The Council of the European Union)

EU leaders on Thursday (18 December) called for a speedy setting up of a special investment fund, but the European Parliament chief cast doubt that it will be ready by June as planned.

"We call for the urgent establishment of a European investment fund for strategic investments and renew our commitment to intensify structural reforms and to continue efforts to ensure sound public finances," EU council chief Donald Tusk said after chairing the economics part of the leaders' meeting.

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The fund, to be hosted in the governments-controlled European Investment Bank, is relying on €21bn in guarantees from the EU budget and the EIB itself, which is supposed to be leveraged fifteen-fold and attract private and public investments to the tune of €315 billion.

The EU commission plans to put forward draft legislation in January and have the European Parliament "fast-track" it so the fund can be set up by June.

But European Parliament chief Martin Schulz in a separate press conference cast doubt that the calendar can be met.

"Fast-track is a very unconcrete term. If we achieved this by June, it would be fine for everybody. The rapporteur is committed to the utmost to accelerate, but in a serious lawmaking process you need time for legislation that is really serious," Schulz said.

He added that it was "unpredictable and not possible" to say if the June deadline could be met noting that it was not just the parliament but also member states that had to move quickly.

"Most of the pending legislation in the EU is not because of the European Parliament, it's because of the council," he added.

According to an EU source briefed on the leaders' talks, there was an attempt to open the discussion on how national contributions to the fund would be calculated - amid north-south divisions on what the "flexibility" of the deficit and debt rules should cover.

"But the discussion didn't go very deep," the source said, noting that the whole round ended in 2.5 hours.

In the final conclusions, leaders "take note" of the indication by the EU commission that national contributions will not trigger the excessive deficit procedure, "necessarily in line with the flexibility that is built into its existing rules."

Schulz said that this would mark a "major change in European policy, for the first time we recognise officially that public investment are not calculated as usual as a spending of money and a first step for more flexibility."

Apart from the investment fund, leaders also agreed on the to-do list for the coming months: energy union, deepening eurozone integration and a step up in the fight against tax avoidance and evasion.

Romania, Bulgaria, the Czech Republic and Slovakia also sought to obtain a one-year extension on unpaid bills from the 2007-2013 EU budget, but all they got was more "assistance" from the EU commission to speed up the absorption of funds in 2015 - the last year they can submit bills for the old multi-annual budget.

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