European Commission President Ursula von der Leyen presents the European Banker of the Year award to EIB President Werner Hoyer
Hoyer warns politicians and business leaders that the innovations needed to achieve a zero-emissions economy will not appear on their own
A banker who isn’t actually a banker has been honoured as European Banker of the Year in a special ceremony: EIB President Werner Hoyer. “After more than 30 years in politics, the idea of receiving this award and to be following in the footsteps of accomplished bankers such as Jean-Pierre Mustier, Axel Weber and Jean-Claude Trichet is still difficult for me to believe,” Hoyer said in his acceptance speech at Frankfurt’s Römer City Hall.
But he is nevertheless happy to accept the title on behalf of the almost 4 000 employees of the European Investment Bank around the world. The accolade was awarded a year ago for 2019 by the Group of 20+1, an association of international financial journalists from leading business media outlets. However, the official award ceremony was postponed from last November to 28 June 2021 due to the pandemic.
The jury had chosen Hoyer because the EIB’s financing programmes are contributing to stability in the European Union. Under Hoyer’s leadership, the EIB has promoted climate action, innovation and productivity in Europe and around the world. It is also the first international financial institution to commit to stop investing in fossil fuels.
In her congratulatory speech, President von der Leyen praised the EU climate bank for being at the forefront of Europe’s ambitions to reduce greenhouse gas emissions.
Alongside his thanks for the accolade, Hoyer issued a warning to politicians and business leaders: “We all know that the years leading up to 2030 are our last chance to avert a catastrophe. If we are to succeed in limiting the global temperature rise to 1.5 °C, EU Member States will have to invest €350 billion in innovation every year this decade.”
For the EIB president it is clear that we will only be able to transition towards a carbon-neutral economy with massive investment in new technologies. It will not be possible to reduce CO2 emissions by 8% each year with restrictions and prohibitions alone, as was the case in 2020 as a result of the pandemic-related lockdowns.
According to Hoyer, the necessary innovations “will not appear on their own.” Any economist will tell you that the overall economic benefits of investment, particularly when it comes to environmental protection technologies, usually significantly exceed the commercial “return.” Market failures will therefore occur – especially in the early phase of technology development – and this leads to underinvestment.
This is where public promotional banks such as the EIB could step in. While policies must promote fundamental research, establish a CO2 price and introduce regulations, the EIB could complement this by providing financing to promising innovation projects. This would also create new export opportunities for European industry.
For example, the EIB has invested in floating wind farms in Portugal and the first gigafactory for lithium-ion batteries in Sweden, and supported hydrogen applications for steel production in Luxembourg, where the EIB is headquartered. In 2020, the EIB supported BioNTech in the early stages of the development of the world’s most successful coronavirus vaccine.
Its ongoing objective is to help make new products market-ready through tailored advisory and financing products.
The 69-year-old economist Werner Hoyer began his career in economics at the University of Cologne. In the 1980s, he co-authored the well-known German economic textbook Grundlagen der mikroökonomischen Theorie. Before becoming EIB president in 2012, he was a member of the German Bundestag for the FDP from 1987. He also served as Minister of State at the Federal Foreign Office for two terms, where he worked on European policy.
Group of 20+ 1
The Group of 20+1 is an association of financial journalists in Frankfurt am Main, Germany, who work for leading European media outlets including the Financial Times, Agence France-Presse, Fortune, Der Spiegel, Frankfurter Allgemeine Zeitung, Süddeutsche Zeitung, Handelsblatt, Die Welt, ARD, ZDF and Thomson Reuters. Every year in collaboration with the specialist publishing house dfv Euro Finance, the group awards the European Banker of the Year title. The award ceremony at the Frankfurter Römer will take place after the Frankfurt Euro Finance Summit, which will be attended by high-ranking representatives from politics and finance.
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