Helping Africa and Neighbourhood
First projects under the EU's External Investment Plan get green lightEuropost
As part of its External Investment Plan (EIP), the EU gave on Tuesday a green light to a package of financial guarantee programmes worth around €800m, the EU press service reported. The decision is a major milestone towards delivering investments in Africa and the Neighbourhood and will help to leverage an estimated €8-9bn in public and private investment in Africa and the Neighbourhood.
The EIP aims to promote inclusive growth, job creation and sustainable development and in this way to tackle some of the root causes of irregular migration. It is expected to leverage €44bn of investments through an EU contribution worth €4.1bn. One of the new programmes for example will benefit people who currently have difficulty borrowing money at affordable rates, such as internally displaced people, refugees or returnees. Another programme will enable over 25,000 small businesses to access mobile accounts and long-term credit, in order to support the financial inclusion driven by diasporas, migrants' families and returnees.
“The EU's External Investment Plan has already started to bring real benefits to the people in our partner countries. These guarantee programmes for sustainable investment give now access to affordable loans to people who have been forced to flee their country and those who have recently returned home to rebuild their lives, to start small businesses or to have access to new technologies. This plan is about building a new present for many people and for their countries, it is about changing lives, now and for good,” VP Federica Mogherini said.
The External Investment Plan's financial pillar consists of two parts: Guarantee Fund (for a total of €1.5bn by 2020) and Blending Facilities (for a total of €2.6bn by 2020). The guarantees will cover operations in several areas: financing for small businesses, including ones involved in agriculture; sustainable cities; sustainable energy and connectivity; and access to the internet and digital services. Since 2017, the EU has made available a total of €1.6bn for interventions mixing EU grants with loans (so-called blending). This will help to leverage up to €14.6b in investments. These programmes will cover areas such as transport, energy, environment, agriculture, urban development.
The EIP is also open for contributions from other donors, including EU Member States, third countries as well as private philanthropic actors. Discussions with such potential donors have proved the innovative, attractive and ambitious approach of the EIP. The EU also welcomed the first major contribution from the Bill & Melinda Gates Foundation, of around €53m. This will attract further investment to spur research and innovation in e-health in less developed and fragile environments.