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European Fund for Strategic Investments (EFSI) 2.0 – increasing to over EUR 500 billion in investments

The European Commission intends to double the duration and the financial capacity of the European Fund for Strategic Investments (EFSI) financing programme. The current EUR 315 billion in investments until 2018 will be extended to  at least EUR 500 billion in investments until 2020. This will most probably be grown further to EUR 630 billion in investments by 2022. The EFSI programme, otherwise known as the Juncker Plan, has so far achieved EUR 116 billion in investments since its inception in 2015.

The enhanced EFSI 2.0 will focus more on environmental and energy investments than before, so as to ensure the fulfilement of the COP21 targets and the transition to an energy efficient economy. Furthermore, this proposal also includes an increase from EUR 193 million to EUR 1 billion in available financing for social enterprises and micro-finance

In order to accomplish the COP21 targets, the European Commission is proposing that at least 40% of available financing be allocated to infrastructure and innovation projects that contribute to climate action. This will be a significant increase from the current situation where such projects have only received 28% of the avaliable financing.

The use of financing through EFSI programme has growing strongly this year, and the EIB at its last meeting has approved EUR 7.3 billion to support 47 new projects with 18 loans. Its several benefits has resulted in it becoming an appealing alternative to grant programmes, such as lower borrowing costs, boost of higher-risk projects and more accessible investment loans. This can be especially helpful for Mid-cap companies through the EFSI-backed InnovFin MidCap Growth Finance (IMGF) programme. The applications for this programme are submitted to the EIB, and the deadline for submissions is until 2020 or until the guarantees provided have been exhausted.

With our in-depth knowledge and vast experience with EU funds, state aid schemes and various funding solutions, we invite you to discuss together the development opportunities that the EFSI programme may provide for your company.

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