EU's EUR 300 bn fund to counter Chinese influence
Ursula von der Leyen - Photo © European Union 2021
(BRUSSELS) - The EU launched a EUR 300 billion 'Global Gateway' fund Wednesday to counter the influence of China and develop links in transport, health, education and research systems across the world.
The EU is looking to further its strategic interests, as a trusted partner to deliver sustainable and high quality projects taking into account the needs of partner countries and ensure lasting benefits for local communities.
The Commission says the Global Gateway is about increasing investments promoting democratic values and high standards, good governance and transparency, equal partnerships, green and clean, secure infrastructures and that catalyse private sector investment.
"COVID-19 has shown how interconnected the world we live in is. As part of our global recovery, we want to redesign how we connect the world to build forward better," said EC president Ursula von der Leyen: "The European model is about investing in both hard and soft infrastructure, in sustainable investments in digital, climate and energy, transport, health, education and research, as well as in an enabling environment guaranteeing a level playing field. We will support smart investments in quality infrastructure, respecting the highest social and environmental standards, in line with the EU's democratic values and international norms and standards."
The EU executive says Global Gateway will bring together the EU, Member States with their financial and development institutions, including the European Investment Bank (EIB), and the European Bank for Reconstruction and Development (EBRD) and seek to mobilise the private sector in order to leverage investments for a transformational impact.
Global Gateway draws on the new financial tools in the EU multi-annual financial framework 2021-2027. The Neighbourhood, Development and International Cooperation Instrument (NDICI)-Global Europe, the Instrument for Pre-Accession Assistance (IPA) III, as well as Interreg, InvestEU and the EU research and innovation programme Horizon Europe; all allow the EU to leverage public and private investments in priority areas, including connectivity. In particular, the European Fund for Sustainable Development+ (EFSD+), the financial arm of NDICI-Global Europe will make available up to €135 billion for guaranteed investments for infrastructure projects between 2021 and 2027 up to €18 billion will be made available in grant funding from the EU budget and European financial and development finance institutions have up to €145 billion in planned investment volumes.
The EU is also exploring the possibility of establishing a European Export Credit Facility to complement the existing export credit arrangements at Member State level and increase the EU's overall firepower in this area. The Facility would help ensure a greater level playing field for EU businesses in third country markets, where they increasingly have to compete with foreign competitors that receive large support from their governments, and thus facilitate their participation in infrastructure projects.
The EU will offer not only solid financial conditions for partners, bringing grants, favourable loans, and budgetary guarantees to de-risk investments and improve debt sustainability – but also promote the highest environmental, social and strategic management standards. The EU will provide technical assistance to partners to enhance their capacity to prepare credible projects ensuring value for money in infrastructure.
Global Gateway - background guide
Joint communication by the European Commission and the High Representative on Global Gateway