How can we reconcile the urgency of the economic recovery with our sustainability ambitions?
Mobilising Horizon Europe and ‘Next Generation EU’ together with national public and private investments for promoting the green and digital transition across all EU regions in the context of a renewed European Research Area (ERA)
Let me start with a warm thank you for the kind invitation to this one-of-a-kind event. I firmly believe that as we are healing from a major economic crisis, our ability to unite and speak one voice is going to define which recovery path Europe will take in the years to come. With this in mind, I would like to thank the Portuguese Presidency in particular, for offering us this opportunity to engage in a constructive discussion about the direction in which we should set our sails.
The motto of the Presidency – Time to deliver: a fair, green and digital recovery – gives me well-founded optimism about the future. Indeed, the future is green and digital. And I do believe that if we embark on the right path now, we will also alleviate the social constraints and build a fair future for everyone in the continent.
Yet we couldn’t have expected a more challenging starting point. The investment horizon has been vastly shattered across the EU because of direct and indirect effects of lockdown restrictions. The 2020-2021 EIB Investment Report, released less than two weeks ago, estimates that the investment contraction was mostly felt in the second quarter of 2020, when investment fell by 19% compared with the previous year.
Without doubt, how we pick up from this bottom depends on the policy response. However, we need to wisely set the priorities so that we set on a prompt yet smart and inclusive recovery path. Let me, therefore, point out two key elements, which I believe should constitute an important layer of the post-crisis economic architecture, to ensure a better coordination among market players, but also mobilising sufficient resources.
The first element is not only to show – but more importantly – to lead the new growth strategy.
We must be ambitious when it comes to our future. In particular, regarding the green transition. Europe embarked on the green path long before the pandemic and so did its Bank – the European Investment Bank. Since 2012, the EIB has provided €197 billion of finance supporting over €670 billion of investment in climate action and environmental sustainability projects. This has made the EIB one of the world’s largest multilateral providers of finance for projects supporting these objectives. Only in the last year, 40% of our financing was deployed to support green projects – out of the total of €66.09 billion.
The EIB does not work alone, however. Under InnovFin and EFSI, the EIB and the European Commission have been able to leverage EU budgetary funds with EIB lending and sector expertise for maximum impact in breakthrough projects. They were championed by the private sector initiatives. Yet without risk-sharing structures, long-term financing or technical advice, swift progress would have faltered.
This lesson brings me to the second element I would like to draw your attention to, which is partnership.
The scale of the decarbonisation challenges calls not only for involvement of both public and private stakeholders, but also for close cooperation among public sector entities. Horizon Europe is, of course, key to enabling this increase in investment in climate mitigation. The initiatives of EU institutions and member states are critically complementary with private sector investment because neither party will achieve the needed scale of investment on its own.
Europe is a global leader in green innovation, and even more so in innovation that is both green and digital. Without doubt, Horizon Europe will play a key role to broaden these competitive advantages going forward. As an accelerator of ideas, I am convinced that Horizon Europe will add the tailwind to the recovery and set it on a green, digital and inclusive path.
Let me reassure you that the EIB Group stands ready to provide its expertise, know-how and resources to facilitate this process – both under Horizon Europe as well as under the new MFF.
With this in mind, I enter the year 2021 with cautious optimism. I realise that, to a large extent, the recovery is on our shoulders. With the two elements I just outlined, I am convinced that we can achieve both prompt and sustainable recovery.
Allow me to stop here. Thank you very much for your attention. I look forward to the following interventions with great curiosity. I also truly hope that we will be able to meet in person in the near future. Thank you.