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21 November 2014

Europe’s investment plan: a game of numbers

investment plan Juncker

The EU Commission is set to present on Wednesday 26 November more details of a 300 billion euro investment plan to stimulate Europe’s struggling economies. But how much will be new money and how effective will this stimulus be?

According to media reports, President Juncker would take existing funds from the EU budget and the EIB as seed money to stimulate private investments for growth and new jobs. But it remains unclear if there will be any real new public money available and how much private investments would follow, resulting in some journalists talking about ‘financial engineering’ or ‘creative accounting’.

Two groups in the European Parliament yesterday launched their alternative ideas for Europe’s investment plan. The S&D (socialists and democrats) group proposed to set up a new 400 billion euro fund for ‘investments in the transition towards a sustainable and resource efficient economy’. The ALDE (liberals) group presented their own ‘European Investment and Recovery Act’ including ideas on how ‘European collateral will attract private investment to close the investment gap of 700 billion euros which is needed to create an interconnected internal market in energy, transport and digital’.

Last year, the ETUC already launched a campaign for a New Path for Europe which would include a public investment of 2 per cent of GDP (about 260 billion euros) each year to be spread over a ten-year period.

On 1 December, the ETUC and Syndex are organising a special conference in the European Parliament to debate the details of this European investment plan.

Follow the latest developments, see our special Storify dossier.

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