The InvestEU Programme is the inheritor of the European Fund for Strategic Investments, also known as the ‘Juncker Plan’, which has mobilized more than 500 billion euros since 2015 and created more than 1.4 million jobs. It promotes flexibility, simplification and synergies by bringing together the 14 European financial instruments.
During the period of 2021/2027, the InvestEU intends to mobilize more than 400 billion euros in public and private investment, structured in four policy windows: sustainable infrastructures, research and innovation, SMEs and social. This mobilization has to be done in line with the EU policy objectives. Therefore, at least 30% of InvestEU must be used for climate objectives, with 60% being the target in the window of sustainable infrastructures. In the aftermath of the COVID-19 pandemic, with a revamped MFF and an innovative Recovery Plan, InvestEU is thus a challenge, yet also an opportunity for the EU and its Member States, particularly in the field of health.
The health sector represents more than 10% of the EU GDP. This sector is of the utmost importance to the Union, not only for the lives of all the European citizens, but also for its economic and innovative added value. Whereas Europe is already facing a “perfect demographic storm”, with increasing costs of healthcare and an ageing population, the resilience of the EU national health systems must be achieved through private and public investments.
In the field of health, these investments can contribute to medical and pharmaceutical research, new pharmaceutical products, such as vaccines, the digitalization of health care services, as well as health infrastructures. The modernization of infrastructures – whether public or private – is clearly encouraged by the respective InvestEU policy window. Moreover, the InvestEU Regulation explicitly foresees the support to “research, development, innovation and manufacturing of pharmaceuticals”.
The Programme can be used to create, for instance, a national instrument to support investments in the provision of medical equipment and health care services. It can also be used to capitalize SMEs: an imperative need amid the COVID-19 pandemic. Furthermore, the InvestEU allows Member States to be programmers, rather than mere users of funds. The European compartment of the InvestEU provides a guarantee of around 26 billion euros, 75% of which will be for the European Investment Bank and the remaining 25% for national promotional banks or other similar institutions. However, the Programme also has a national compartment in which Member States may voluntarily put the amounts from their respective national budgets, so as to create national financial instruments dedicated to the investments that they wish to implement.
In this context, the European countries can use a maximum amount of 4% of the national envelope of the Recovery and Resilience Facility (RRF), and 5% of the Cohesion Policy funds, for the constitution of this guarantee.
Member States that have promotional banks are better positioned to access InvestEU and to “manufacture” and mediate the financial instruments they deem most appropriate.
Yet, this opportunity comes along with an urgency: the possibility of using the national compartment of the InvestEU must be foreseen in the national Recovery and Resilience Plans (nRRPs) and in the partnership agreements between the European Commission and the Member States in the framework of the EU Structural and Investment Funds (ESIF) for 2021/2027. To benefit from the leverage effect of the transfers between the national compartment of the InvestEU and the RRF/ESIF funds, Member States must absolutely design their nRRPs and partnership agreements accordingly, in full complementarity and from an early stage. It makes perfect sense for the InvestEU to be additional.
On the one hand, economically viable projects which aim to fill market failures and investment gaps in the EU and which would have no other form of financing are eligible. On the other hand, the EU encourages ‘blending’, that is, the merging of InvestEU loans with the grants provided by other European funding.
The Program includes an investor advisory platform (Advisory Hub), which is free of charge for public entities, and which will provide advice, for example, for the structuring of projects or the creation of national and regional investment platforms.
Member States should also have an advisory structure that cooperates with the Advisory Hub, which would result in more and better investment.
The InvestEU also has an Investment Portal where promoters can place their investment intentions, in order to raise financing from private investors. Despite the European Parliament’s efforts, the InvestEU does not foresee a specific policy window for strategic investments, following a regrettable veto by the Member States. Yet, the Programme can boost public and private investments in the health sector, strengthening competitiveness, increasing productivity, promoting to territorial, economic and social cohesion, while, at the same time, funding the health sector as an EU-wide strategic investment. Through the InvestEU, the Union intends not only to keep the jobs of the European citizens, but also to create quality jobs, in a society in which health is more important than ever. The Europeans deserve it, and Member States must be up to the task.