Instruments for Financing Investment Opportunities in Post-Crisis Europe: The Investment Plan for Europe

• Author: Mariana Trandafir, Manuela Panaitescu
• Pages: 286-293

European Integration - Realities and Perspectives. Proceedings 2016

286

Instruments for the Financing Investment Opportunities in Post-Crisis

Europe: The Investment Plan for Europe

Mariana Trandafir1, Manuela Panaitescu2

Abstract: The study is based on an analysis of the opportunities provided by The Investment Plan for Europe.

The Plan, launched in December 2014, aims at stimulating additional investment at least EUR 315 billion in

real economy in the 2015-2017 period and making th e most of every public euro mobilized through both new

and existing instrument, in order to achieve the high multiplier effect. The challenge for the Member States is

to put the funds made available by these instruments to productive use in order to support sustainable jobs

and growth in Europe. In this context, Romania is facing a major challenge: to promote projects of interest to

investors, economically viable, sufficiently mature and consistent with EU poli cy p riorities. According

official sources, until the mid - March 2016, only two projects was selected for financing throu gh The

Investment Plan for Europe. The study contributes to the identification of the new innovative financial

instruments th at could improve the access to finance in general and to Romanian projects especially. The

analysis uses the most recent official data, official d ocuments published by the European Commission and

other institutions in the field.

Keywords: The European Fund for Strategic Investments; financial instruments; the Eu ropean Investment

Bank

1. Introduction

The recent global crisis has brought deep changes on all levels of economic and financial activity,

affecting strongly also the investments at European level. In 2014, six years after the global financial

crisis started, the pace of economic recovery in the EU is still slow, weak investment has been one of

the main reasons for the weakness of this recovery (Final Task Force Report, 2014). Although there is

considerable variation between Member States and sectors, EU investment activity in 2013 was 15

percent or some EUR 430 billion below the pre-crisis peak in real terms; in the hardest-hit Member

States the shortfall ranges from 25 to over 60 percent. (Final Task Force Report, 2014, EIB, 2015). It’s

important to mention that, for most of the euro area Member States which have been heavily hit by the

crisis, both private and public investments have collapsed with the crisis and that low levels of public

investment, if maintained over a prolonged period, may lead to a deterioration of public capital and

diminish longer-term growth potential. (ECB, 2016). In the 2012-2014 period, for instance, the public

investment- to- GDP ratio was between 1,9 in Ireland and 5,6 in Estonia while the private investment–

to- GDP ratio was between 12,9 in Portugal and 21,3 in The Czech Republic (chart 1).

1 Associate Professor, PhD, Danubius University of Galati, Faculty of Economic Sciences, Romania, Address: 3 Galati Blvd.,

Galati, Romania, Tel.: +40372361102, Fax. +40372361290, E-mail: marianatrandafir@univ-danubius.ro.

2 Senior Lecturer, PhD, Danubius University o f Galati, Faculty of Economic Sciences, Romania, Address: 3 Galati Blvd.,

Galati, Romania, Tel. +40372361102, Fax. +40372361290, Corresponding author: manuelapanaitescu@univ-danubius.ro.