Transparency & Accountability • 31 Aug 2015
The new European Investment Plan
A critical analysis of financial instruments and infrastructure financing
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In November 2014 the European Commission announced a new Investment Plan that is to 'unlock' €300 billion of investments in the 'real economy' between 2015 and 2017. The plan was promoted as a paradigm shift and crucial to lead Europe out of the current crisis. However some serious concerns exist regarding this effectiveness of the so called Juncker Plan.
This report focuses on a few elements that may undermine the promises of unlocking huge investment in the real economy. It explores the following questions:
- Is the plan providing provide enough fresh money?
- Will it be used to further the development of unsustainable infrastructural projects (such as infrastructure for gas or other fossil fuels)?
- Is the project selection going to be transparent and subject to public scrutiny?
- What about the danger of socialising high risks of private investments while privatising profits?
- Do the financial mechanisms that are to be deployed, such as Project Bonds, imply a risk of imposing financial markets as a mediator between public investment and the real economy?
