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The EU and other investment facilities (e.g. UniCredit) have intensified their efforts to provide necessary financial support to businesses in Central and Eastern European countries to transition along sustainable growth directions and creating additional employment. SMEs in Bulgaria, Croatia, Czechia, Hungary, Romania, Slovakia and Slovenia will be able to accelerate their transition towards “greener business” and digital solutions.
The EU-wide InvestEU program provides the EU member states with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable growth and recovery. The European budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.
The program helps in mobilizing public and private investments for the member states’ political economy’s priorities, such as the “green deal”, digital transition and sustainability. Facilitating access to finance for SMEs is a vital sphere of investment; it includes capital support for businesses that were negatively affected by the pandemic crisis and transition to climate mitigation, digitalisation and sustainability. Within the EIB Group the European Investment Fund will implement the major share of InvestEU financing for smaller companies.
The InvestEU program brings together under one roof several presently available EU-wide financial instruments to support European governments’ efforts by making funding for “green investment projects” simpler, more efficient and flexible. One of the best examples is, for instance, investment assistance for projects concerning energy efficiency of residential buildings.
The InvestEU program gives an additional boost to investment, innovation and job creation in the EU member states during 2021-27 by triggering over €372 billion in investments using an EU budget guarantee facilities.
Investment’s program’s main components
The EU-wide investment program consists of three components: = InvestEU Fund, = InvestEU Advisory Hub and = InvestEU Portal.
= InvestEU Fund was launched in 2021 with the aim of providing direct and intermediated financing solutions for both private and public projects in the EU states. Investments are implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The InvestEU Fund combines thirteen centrally managed EU financial instruments, the European Fund for Strategic Investments (EFSI) and the European Investment Fund (EIF) into one instrument.
More on partnerships in: https://www.eib.org/en/products/mandates-partnerships/investeu/
The guarantee available under the InvestEU Fund is used in partnership with selected financial partners, or ‘implementing partners’.
More about implementing partners in: https://investeu.europa.eu/what-investeu-programme/investeu-fund_en
Major partners in the EIB Group (European Investment Bank and European Investment Fund) are responsible for the implementation of 75% of the EU Guarantee. A guarantee agreement with the EIB Group was signed in March 2022 so that companies and project promoters could start applying for financing under the InvestEU mandate. Guarantee agreements with other implementing partners are being concluded during 2022-23. For example, the European Investment Bank (EIB) is the EU long-term lending institution owned by the member states. The Bank’s investments under the InvestEU program are focused on projects operating in four priority areas: infrastructure, innovation, climate and environment, as well as SMEs. Already presently, the InvestEU, together with other financial institutions is mobilizing about €19.65 billion of investments across European states.
= InvestEU Advisory Hub is the central “entry point” for project promoters and intermediaries seeking advisory support and technical assistance related to centrally managed EU investment funds. It is managed by the European Commission and financed by the EU budget and connects project promoters and intermediaries working to help the available projects reaching a financing stage. The Advisory Hub complements the InvestEU Fund by supporting the identification, preparation and development of investment projects in the EU-27 states; together with the InvestEU Portal – the EU’s online matchmaking tool – it aims at strengthening regional investment and business environment.
The InvestEU Advisory Hub replaces earlier existing thirteen centrally managed advisory programs and serves as the central entry point for advisory and technical assistance requests. The Advisory Hub does not just continue the existing advisory programs, but upgrades and improves them to meet promoters’ needs and help turn business and project ideas into successful investment projects.
The Advisory Hub budget implements about 75% of services to beneficiaries, and provides strategic support to the European Commission in developing and reinforcing advisory initiatives. The European Investment Bank Group (EIBG) acts as the main Advisory Partner within the InvestEU Advisory Hub.
More in: https://investeu.europa.eu/what-investeu-programme/investeu-advisory-hub_en
= InvestEU Portal brings together investors and project promoters on a single EU-wide database of investment opportunities available within the EU. The InvestEU Portal (the Portal) forms an integral part of the InvestEU Program, together with the InvestEU Fund and the InvestEU Advisory Hub. The Portal allows project promoters to reach investors that they may not be able to reach otherwise. The Portal continues the work started under the European Investment Project Portal (EIPP) and is the online EU ‘marketplace’ connecting EU-based project promoters to investors worldwide; this way it provides project promoters with more options to finance their projects.
In order to submit a project for publication on the Portal, promoters have to log in and register on the Portal. The submission process is quick and easy: a dedicated user-friendly tool guides promoters through the registration process. Promoters have their own user profile to submit projects. Publication on the Portal is free of charge. However, to be published on the Portal, projects have to fulfill specific admission/eligibility criteria set in Commission Implementing Decision (EU) 2021/626.
See the Decision in: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32021D0626&from=EN
In order to contact promoters of projects published on the Portal, investors have to be registered on the Portal too. A dedicated tool guides users through the registration process in completing their user profile.
More on Portal in: https://investeu.europa.eu/what-investeu-programme/investeu-portal_en
EU’s “green lending” facilities: practical outcomes
InvestEU is a key instrument for supporting SMEs and small mid-caps in the EU member states; thanks to this agreement, the EU and other investment facilities have intensified provision of necessary support to businesses in Central and Eastern European countries to transition along sustainable growth directions and creating additional employment.
Besides the Invest EU, the EIF provides two guarantees worth around €370 million to UniCredit Group to finance approximately €1 billion of investment made by small businesses in seven countries across Central and Eastern Europe.
These agreements were made possible with the support of the InvestEU programme. Up to 2 500 small businesses and small mid-caps are expected to benefit from increased access to finance. One of the practical facilities for applicants is those of the existing commercial bank:
= UniCredit. The agreement between the EIF and UniCredit (as a pan-European commercial bank) aims at boosting funding in the fields of sustainability, innovation, twin green and digital transition, as well as in facilitating cultural, educational and social sectors in the EU member states.
UniCredit provides sustainable finance to fuel social investments and innovation to improve social aspects of environmental, social and governance efforts. During last ten years, working with the EIB Group, the UniCredit has enabled easier access to financing for more than 12 000 SMEs in Central and Eastern Europe. Its presence in the European region meant that strategic partnership with the EIF and the EIB Group provided for the biggest allocation of InvestEU guarantee capacity. This will enable to provide even more support for SMEs by empowering local communities towards digitalisation, creativity, education and social responsibility.
More in: https://www.eif.org/InvestEU/news/2023/investeu-eif-and-unicredit-sign-agreements-to-channel-eur-1-billion-to-small-businesses-across-seven-countries-in-central-and-eastern-europe.htm?lang=-en
General reference to: https://ec.europa.eu/commission/presscorner/detail/da/IP_23_2682