COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Investment Plan for Europe: evaluations give evidence to support its reinforcement
Date: 2016-11-29
Institutions: Directorate-General for Economic and Financial Affairs, European Commission
Subjects: EU Member State, EU investment, European Investment Bank, fund (EU), investment aid, investment project, investment promotion, investment protection, private investment, public investment

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   EUROPEAN COMMISSION  Brussels, 29.11.2016  COM(2016) 764 final   COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Investment Plan for Europe: evaluations give evidence to support its reinforcement    
 
 
1. 

INTRODUCTION 

President Juncker’s State of the Union address of 14 September 2016 underlined the need for 
Europe to strengthen its economic recovery and invest strongly in its youth and jobseekers, as 
well as in its start-ups and SMEs1. Against that background, the Annual Growth Survey 20172 
outlined the most pressing economic and social priorities on which the European Union and 
its Member States need to focus their attention in the coming months.  

Europe is experiencing a fragile but relatively resilient and job-intensive recovery. Its GDP is 
now  higher  than  before  the  crisis.  Unemployment  is  decreasing  and  investment  is  growing 
again. However, there is no room for complacency. Some of the tailwinds that have supported 
the recovery so far are fading. The legacies of the crisis, notably the social impact, high levels 
of public and private debt, and the share of non-performing loans, are still far-reaching. 

The Investment Plan for Europe has proven useful in encouraging a sustainable increase in 
investment  in  Member  States.  The  European  Fund  for  Strategic  Investments  (EFSI)3  has 
mobilised EUR 154 billion across 27 Member States in just over one year, which is expected 
to  benefit  almost  377,000  SMEs.  The  EFSI  is  making  a  real  difference  by  supporting 
innovative and strategic projects that contribute to job creation and growth (Box 1).  

Given the concrete results of the EFSI, and as announced in President Juncker’s State of 
the  Union  address,  the  Commission  proposed4  in  September  2016  to  reinforce  and 
expand it through the so-called EFSI 2.0 proposal.  With a view to doubling the duration 
and  capacity  of  the  EFSI,  in  a  first  step  the  proposal  extends  the  duration  until  the  end  of 
2020,  increasing  the  total  investment  target  from  EUR  315  billion  to  at  least  half  a  trillion 
euro. The proposal also puts a greater focus on private sector contributions and additionality 
and  on  enhancing  transparency  in  the  selection  of  projects.  Further,  EFSI  2.0  puts  strong 
emphasis on the combination of EFSI support with other EU funds and with financing from 
National Promotional  Banks (NPBs)  as  important ways to  improve the EFSI’s geographical 
coverage.  Furthermore,  the  proposal  includes  enhancements  of  the  scope  of    the  European 
Investment Advisory Hub (EIAH or Advisory Hub), given the need to help construct a steady 
supply of projects and Investment Platforms that can be financed in all Member States. 

In October, the European Council “called on the Council to agree its negotiating position on 
the Commission’s new EFSI proposal at its meeting on 6 December, taking into account the 
independent external evaluation that will be delivered in November”5. 

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http://ec.europa.eu/priorities/state-union-2016_en  
COM(2016) 725 final. 
Regulation (EU) 2015/1017 of the European Parliament and of the Council of 25 June 2015 on the 
European Fund for Strategic Investments, the European Investment Advisory Hub and the European 
Investment Project Portal and amending Regulations (EU) No 1291/2013 and (EU) No 1316/2013 — the 
European Fund for Strategic Investments, OJ L 169, 1.7.2015, p. 1. 
COM(2016)597 final. 
EUCO 31/16, 21 October 2016, point 18. 

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BOX 1 — EXAMPLES OF APPROVED EFSI PROJECTS 

  Creta  Farms  (Greece)  seeks  to  make  meat  products  healthier,  by  injecting  extra  virgin 
olive oil into meat products. The technology is used to remove saturated animal fats, that 
are bad for human health, and replace them with unsaturated ones that help to lower "bad" 
cholesterol  levels.  Today,  Creta  Farms  is  the  biggest  player  in  the  Greek  cold-cuts  meat 
market and has already successfully expanded abroad. With the EFSI funds, the company 
will fund further technological advances to introduce "oliving" into snack foods. This will 
allow it to hire 100 new employees and continue its international expansion. 

  Malin Corporation (Ireland) is a global life sciences company that invests into innovative 
R&D  companies  in  their  early-stages  in  the  life  sciences  sector.  The  recent  EUR  70 
million EFSI contribution, will enable the company to increase its investments across the 
European life sciences industry over the next seven years. EUR 40 million of the loan is 
already being used to support cutting edge innovation and development of new products 
by  private  life  science  companies  in  Ireland  and  the  UK.  Thanks  to  the  EFSI  support 
Malin  will  be  able  to  help  life  science  companies  reach  their  full  potential  and  achieve 
commercial success. 

  PEP-Therapy/Quadrivium (France) PEP Therapy is a research company that was founded  
in 2014 by scientists working at prestigious French research institutions. The team behind 
it developed a technique that blocks specific functions of proteins that turn a healthy cell 
into  a  cancerous  one.  The  aim  is  to  develop  a  treatment  that  will,  unlike  chemotherapy, 
only destroy cancerous cells and preserve the good and healthy ones. To fund its project, 
PEP-Therapy  received  EUR  1  million  support  from  Quadrivium  1,  a  French  investment 
fund that received a EUR 20 million injection from the European Investment Fund (EIF). 
  WOW  Technology  (Belgium)  is  a  company  specialised  in  the  production  of  tailor-made 
including:  aeronautic, 
machinery  and  automated  equipment  for  various  sectors, 
automotive, biotech, pharma, agro-food, environment and energy. Its centrepiece machine, 
the  "Shaker  Robot",  permits  the  automatation  of  the  large-scale  production  of  cellular 
cultures that are used in the production of vaccines. Thanks to a loan backed by the EIF 
under the EFSI, the company plans to double its growth in the next five years by doubling 
its  number  of  employees  and  expanding  to  other  European  markets  such  as  France, 
Germany and Switzerland. 

  Accessibility Ports Infrastructure project (Spain) consists of a framework loan to fund rail 
and road access investments in state-owned ports in Spain through a State Fund – “PAF” 
(Port Accessibility Fund). The project will help to improve land connectivity in key ports 
all  located  in  the  Trans-European  Network  –  Transport.  The  operation  will  be  a 
continuation  of  the  extensive  support  provided  by  the  EIB  to  the  development  of  this 
seaport network over the last years. 

  Rydgier Hospital (Poland) in the city of Torun will receive a loan of approximately EUR 
57  millon  from  the  European  Investment  Bank  (EIB)  under  EFSI  to  finance  its 
rehabilitation.  The  project  is  part  of  an  investment  programme  focused  on  achieving  the 
technical and professional hospital  standards required by Polish  and EU law. This is the 
first  public-sector  transaction  in  the  country  benefitting  from  the  EU  budget  guarantee 
under the EFSI. This transaction is also a model for combining EFSI financing with EU 
grant support in the innovative form of a financial instrument: in addition to the EFSI loan, 
EU Structural and Investment Funds (ESIF) will be used to finance the project. 

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The  current  EFSI  Regulation  mandates  three  evaluations:  (i)  an  evaluation  from  the 
Commission on the use of the EU guarantee and the functioning of the EFSI guarantee fund6 
accompanied by an opinion of the Court of Auditors7; (ii) an evaluation from the EIB on the 
functioning of the EFSI8; and (iii) an independent external evaluation on the application of the 
EFSI Regulation9. Those evaluations allow stakeholders to gain a comprehensive view of the 
functioning of the EFSI so far, and are already feeding into the ongoing legislative discussions 
on EFSI 2.0. 

The  EFSI  2.0  proposal  addresses  the  issues  identified  in  the  evaluations  and  will  ensure  a 
smooth  continuation  of  EFSI  operations,  without  disruptions  in  financing,  assuring  project 
promoters that they can still prepare projects even after the initial investment period. 

The Investment Plan for Europe is already making a real difference in a range of sectors by 
supporting  innovative  projects  that  contribute  to  job  creation  and  growth  in  local 
communities,  as  well  as  by  tackling  youth  unemployment  by  supporting  innovative  and 
strategic and young companies in their development. Those projects are critical for the future 
competitiveness of the EU economy and target key areas such as support to SMEs, innovation 
and  R&D,  renewable  energy,  energy  efficiency  and  security  of  supply,  environment  and 
digital,  social  and  transport  infrastructure  or  services.  The  comprehensive  strategy  pursued 
under  the  Investment  Plan  has  the  objective  of  sustainably  increasing  investment  levels  in 
Europe which have lagged behind since the financial crisis. The first pillar of the Plan, with 
the  EFSI  and  the  objective  of  improving  the  use  of  the  EU  budget  in  general,  allows  the 
leveraging of scarce public resources by attracting private investors and supporting innovative 
and strategic projects in Europe that deliver tangible results for jobs and growth. 

The  second pillar  of  the  Investment  Plan  –  the Advisory  Hub  and  the European  Investment 
Project  Portal  (EIPP)  (Box  2)  –  help  to  ensure  that  investments  reach  the  real  economy  by 
promoting the creation of a stable pipeline of bankable projects and boosting transparency. 

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Pursuant to Article 18(2) of Regulation (EU) 2015/1017. See SWD(2016) 297 final. The evaluation is 
available at: http://eur-lex.europa.eu/legal-
content/EN/TXT/?qid=1473853487429&uri=SWD:2016:297:FIN  
Pursuant to Article 18(2) of Regulation (EU) 2015/1017 and Article 287(4) TFEU. See Opinion No 
2/2016. The opinion is available at: http://www.eca.europa.eu/en/Pages/NewsItem.aspx?nid=7766  
Pursuant to Article 18(1) of Regulation (EU) 2015/1017. The evaluation is available at: 
http://www.eib.org/infocentre/publications/all/evaluation-of-the-functioning-of-the-efsi.htm  
Pursuant to Article 18(6) of Regulation (EU) 2015/1017. The  independent evaluation is available at: 
https://ec.europa.eu/priorities/publications/independent-evaluation-investment-plan_en  

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BOX 2 — THE EIPP IS PART OF THE SECOND PILLAR OF THE 
INVESTMENT PLAN FOR EUROPE 

Designed as a bridge between EU project promoters and investors worldwide, the EIPP 
now offers more than 130 projects:  ec.europa.eu/eipp  
It boosts the visibility of existing EU investment opportunities in service to investors, 
providing a transparent forward looking pipeline and facilitating contact to project 
promoters. 

Sustainable investments require a solid and predictable business environment. Under the third 
pillar of the Investment Plan, actions with the purpose of removing bottlenecks to investment 
at  the  level  of  the  EU  and  Member  States  help  to  improve  the  investment  environment, 
generating long-term and sustainable growth in Europe. The EU and its Member States have 
taken steps to tackle barriers to investment, but more needs to be done. While the Commission 
will continue its efforts to improve the overall investment environment at EU level, including 
by  deepening  the  Single  Market,  Member  States  should  step  up  their  efforts  to  remove 
obstacles to investment at national, regional and local level.  

Moreover, experience with the EFSI indicates that those Members States that have benefitted 
the most so far are those with more developed financial markets and a business environment 
conducive  to  investments.  This  suggests  that  these  Member  States  are  in  general  more 
effective  in  generating  EFSI  project  proposals  compared  to  their  peers.  In  addition,  strong 
NPBs can contribute to the development and co-financing of projects. 

The  Commission  has  also  put  forward  concrete  initiatives  that  should    facilitate  the 
financing  of  the  real  economy.  Member  States  will,  for  example,  benefit  from  clearer 
guidance  on  public  accounting  rules,  particularly  in  the  area  of  Public-Private  Partnerships 
(PPPs)10.  The  Commission  is  closely  monitoring  the  impact  of  the  interpretation  of  public 
accounting rules on the creation of PPPs in different sectors and will consider further action 
where appropriate. The Commission has also provided practical guidance on the application 
of State aid rules on the public funding of infrastructure11. Pilot projects have been launched 
recently  to  pursue,  at  EU  level,  a  stronger  convergence  of  the  timelines  of  the  different 

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A guide to the statistical treatment of public and private partnerships, produced by Eurostat in cooperation 
with the European Investment Bank and addressed mainly to private stakeholders, was released on 29 
September 2016, Eurostat / EPEC / European Investment Bank, ‘A Guide to the Statistical Treatment of 
PPPs’, September 2016. 
Commission Notice on the notion of State aid as referred to in Article 107(1) of the Treaty on the 
Functioning of the European Union (2016/C 262/01), OJ C 262, 19.7.2016, p. 1.  

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procedures  regarding  strategic  infrastructure  investment  projects.  The  pilot  covers,  in  a  first 
stage, Belgium and Slovakia. Based on an assessment of these projects, the Commission will 
extend this initiative to other Member States in the course of 2017, with the ambition to create 
an  effective  “one-stop-shop”  for  all  Member  States,  bringing  together  all  responsible 
Commission services – including its Representation offices in the Member States – in a single 
investment policy team.  

In  addition,  work  on  the  Energy  Union,  the  Capital  Markets  Union,  the  Single  Market 
Strategy, the Digital Single Market Strategy, the circular economy and international trade and 
investment  agreements  covers  specific  measures  that,  when  fully  implemented,  will  help 
remove  barriers,  promote  innovation  and  improve  the  environment  for  investment.  The 
Commission will shortly adopt an energy package to boost clean energy transition and energy 
efficiency, to support EU global leadership in renewable energies and to provide a fair deal 
for energy consumers. The package will aim to provide predictability for businesses, investors 
and society and to facilitate investment at national level, notably through National Energy and 
Climate Plans. Similarly to the proposals made to reduce capital charges for insurers investing 
in  qualifying  infrastructure  projects12,  the  Commission  proposed  on  23  November  2016  a 
reduction  of  bank  capital  charges  for  certain  infrastructure  investments13.  On  22  November 
2016,  the  Commission  put  forward  a  cross-cutting  agenda  of  actions  to  support  start-ups  in 
Europe14,  as  well  as  a  proposal15  for  a  Directive  to  increase  the  efficiency  of  insolvency 
procedures and preventive restructuring and second chance frameworks, removing the barriers 
to investment resulting from divergences in such frameworks across Member States. 

Member States also need to step up their efforts in implementing the necessary reforms 
with a view to remove obstacles to investment that were identified in the context of the 
European Semester, most recently in the Annual Growth Survey16. The reforms identified 
in the country-specific recommendations take into account specific national factors. They are 
necessary to sustain and increase investment levels in Member States. Despite action taken by 
some Member States, in particular by euro area countries heavily hit by the crisis, progress to 
address barriers to investment has been overall uneven and more needs to be done. In addition 
to tackling barriers and bottlenecks to investment, the Commission also encourages Member 
States  to  set  up  planning  and  coordination  structures  across  all  administrative  levels  and 
funding  sources.  Against  the  background  of  Member  States’  investment  policies,  these 
structures can  create and strategically manage stable pipelines of key public sector projects, 
facilitate  the  regulatory  and  administrative  procedures  for  authorisation  and  can,  in  turn, 
cooperate closely with the Commission services and the Advisory Hub.   

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Commission Delegated Regulation (EU) 2015/467 of 30 September 2015 amending Commission 
Delegated Regulation (EU) 2015/35 concerning the calculation of regulatory capital requirements for 
several categories of assets held by insurance and reinsurance undertakings (OJ L 85, 1.4.2016, p. 6). 
COM(2016) 850. 
COM(2016) 733. 
COM(2016) 723. 
COM(2016) 725 final.  

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2.  HOW HAVE THE EFSI AND ITS INVESTMENTS IN THE REAL 

ECONOMY BEEN EVALUATED SO FAR? 

In  this  section,  a  summary  is  provided  of  the  key  arguments  made  in  the  three  evaluations, 
followed by a description of how the EFSI 2.0 proposal addresses these points. 

Relevance and additionality of EFSI support 

The  evaluations  conclude  that  the  EFSI  has  been  relevant  in  addressing  investment 
needs  in  Europe.  The  independent  evaluation  points  to  the  persistent  investment  gaps  and 
market needs and concludes that the EFSI is contributing to closing that gap by addressing the 
need for high-risk financing.  

Such high-risk financing needs to provide additionality (defined as EIB Special Activities17, 
i.e. operations with a higher risk profile) and crowd-in a maximum of private sector finance. 
The EIB evaluation underlines that the EU guarantee allowed the EIB to significantly increase 
the level of its Special Activities, from around EUR 4 billion to an expected EUR 20 billion 
per  year.  The  evaluations  underline  that  the  EFSI  allowed  the  EIB  to  expand  its  client  and 
product base, in particular by developing new subordinated products, that helped the EIB to 
adapt and respond to market needs.  

However,  the  independent  evaluation  notes  that  notwithstanding  the  fact  that  all  EFSI 
operations  were  EIB  Special  Activities,  in  some  cases  stakeholders  perceived  them  not  to 
provide for a higher risk compared to what the commercial market could offer. In the same 
context,  the  EIB  evaluation  points  to  the  need  for  a  clearer  definition  of  additionality  in 
relation to Special Activities in order to ensure higher consistency in project selection while 
mitigating  potential  reputational  risks  to  the  EFSI.  Similarly,  the  independent  evaluation 
stresses that the fulfilment of the additionality criterion should go beyond “ticking the box” of 
EIB Special Activities, and that the underlying assessment for additionality should be made 
more transparent.  

Multiplier and mobilisation of private investment 

The independent evaluation concludes that the EFSI is effective in increasing access to 
financing and mobilising private capital, noting an expected portfolio multiplier of 14.1 
for  signed  operations  (fully  in  line  with  the  target  of  15  over  the  whole  EFSI-investment 
period)  and  63%  of  private  investment  mobilised  (no  precise  target  was  set)  as  of  30  June 
2016.  Both  the  EIB  and  the  independent  evaluation  note  that  the  two  EFSI  windows 
(infrastructure and innovation window and SME window) progressed at different speeds. For 
instance,  in  implementing  the  SME  window,  the  EIF  accelerated  the  roll-out  of  existing 
mandates  and  only  later  introduced  new  products.  In  contrast,  in  implementing  the 
infrastructure  and  innovation  window,  the  EIB,  while  being  able  to  use  some  existing 

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Special activities are activities for which the EIB internal rating is below investment grade, i.e. riskier 
activities than EIB standard operations. 

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products, needed time to develop a new range of products, which are characterised by having 
both a higher risk profile and sometimes higher (external) multipliers. Those new products are 
expected to complement existing products and are being rolled out after EFSI’s first year of 
implementation. 

► Addressing additionality of EFSI support and mobilisation of private investment in 
the EFSI 2.0 proposal 

Since  its  launch  over  one  year  ago,  the  EFSI,  implemented  and  co-sponsored  by  the 
Commission’s strategic partner for investments, the EIB Group, is firmly on track to deliver 
the  objective  of  mobilising  at  least  EUR  315  billion  in  additional  investments  in  the  real 
economy by mid-2018 while endeavouring to maximise private sector contributions.  

The market absorption has been particularly quick under the SME window  where the 
EFSI is delivering well beyond expectations. This is in line with the very positive reception 
that EFSI has received from SME stakeholders.To ensure that sufficient funding is available 
to  continue  providing  finance  to  SMEs  with  EFSI  support,  in  July  2016  the  SME  Window 
was  scaled-up  by  EUR  500  million  within  the  existing  parameters  of  Regulation  (EU) 
2015/1017. The projects approved by the EIB Group under both windows by mid-November 
2016 under the EFSI mobilise EUR 154 billion in total investments across 27 Member States 
and to support some 377,000 SMEs. 

A  key  element  of  EFSI  2.0  is  a  further  reinforcement  of  additionality  of  the  projects 
supported. The Commission's EFSI 2.0 proposal makes it even clearer that projects under the 
EFSI  need  to  address  sub-optimal  investment  situations  and  market  gaps,  as  part  of  the 
eligibility  criteria.  In  the  current  context  of  low  interest  rates  and  ample  liquidity,  the  key 
factors  to  assess  the  additionality  of  the  EFSI  are  higher  risk  coverage  including  through 
subordination,  exposure  to  specific  risks  –  such  as  unproven  technology  and  higher-risk 
counterparts –  as well as investments in new cross-border infrastructures, which in turn will 
increase  confidence  and  overall  access  to  finance,  in  particular  for  high  risk  operations.  In 
view  of  their  importance  for  Europe,  the  new  proposal  identifies  cross-border  infrastructure 
projects,  including  related  services,  as  providing  additionality.  This  is  an  area  which  is 
currently underdeveloped, and which needs to be stimulated to facilitate investments. 

The mechanisms of the Investment Plan for Europe work and EFSI 2.0 proposes to reinforce them 
to continue the mobilisation of private financing for investment in sectors important to Europe’s 
future  and  where  market  failures  or  sub-optimal  investment  situations  remain.  The  aim  of  the 
EFSI  continues  to  be  to  support  investments  that  could  not  have  been  carried  out  in  the  same 
period or to the same extent by the EIB, the EIF or under existing Union financial instruments 
without the EFSI support. In line with the initial investment period, private investment should be 
attracted  to  the  maximum  extent  possible,  and  SMEs  will  be  a  key  beneficiary  of  the  support 
provided.  

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Geographic and sectorial distribution of EFSI support 

The  three  evaluations  point  to  a  good  overall  coverage  by  sector  and  Member  State, 
given that at the time of the evaluations the EFSI already covered 26 Member States in 
all  eligible  sectors18.  However,  both  the  EIB  and  the  independent  evaluation  note  that 
the  EFSI  portfolio  is  highly  concentrated  in  a  number  of  Member  States19.  The 
independent  evaluation  notes  that  possible  reasons  for  lower  EFSI  support  in  Central  and 
Eastern  Europe  could  stem  from  less  availability  of  the  necessary  technical  expertise  to 
develop  large  projects  and  private-public  partnership  structures,  the  absence  of  central 
planning  and  coordination  structures,  the  relative  smaller  size  of  projects,  less  developed 
venture  capital  markets,  but  also  the  need  for  more  complementarity  with  the  ESIF  in 
particular. It stresses the importance of capacity development in the preparation of projects to 
enhance the geographic coverage of the EFSI. While both the independent evaluation and the 
EIB  evaluation  also  point  to  a  certain  sectorial  concentration  of  EFSI  support,  it  was  not 
identified as a major issue by stakeholders.   

Coherence and complementarity with other sources of Union funding 

The three evaluations point to a high potential in developing new forms of cooperation 
between  the  EFSI  and  other  sources  of  EU  funding,  but  also  underline  the  need  to 
carefully  monitor  the  interaction  between  some  of  those  Funds  with  the  EFSI.  The 
independent  evaluation  finds  that  the  EFSI,  COSME20  and  Horizon  2020  Innovfin21 
complement each other well, as the EFSI enabled those funds to be frontloaded to respond to 
the high market needs in the SME window of the EFSI. Another concrete illustration of the 
possibility  to  efficiently  combine  those  funds  was  delivered  by  the  launch  on  8  November 
2016  of  the  Pan-European  Venture  Capital  Fund(s)-of-Funds22:  by  pooling  different 
resources, this programme aims to further address Europe’s equity gap, the fragmentation of 
the venture capital market and to attract additional private funding from institutional investors 
into  the  EU  venture  capital  asset  class,  in  order  to  support  the  growth  of  innovative 
entreprises.  

With  respect  to  the  financial  instruments  of  the  Connecting  Europe  Facility  (CEF)  and 
Horizon  2020  (H2020),  the  EIB  evaluation  finds  that  those  programmes  may  potentially 
compete with the EFSI, and that the EIB sometimes privileges EFSI over the CEF or H2020 

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21  

Currently projects across 27 Member States have been approved for EFSI support. 
Both evaluations identify the following Member States in which the EFSI portfolio is concentrated: 
Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, 
Portugal, Spain, Sweden and the United Kingdom. However, a more balanced coverage is observed if the 
impact of EFSI investments is compared to the GDP of the countries concerned.  
EU programme for Competitiveness of Enterprises and SMEs. More information on this programme can 
be found on: https://ec.europa.eu/growth/smes/cosme_en 
EU finance for innovators. More information can be found on: 
http://www.eib.org/products/blending/innovfin/  

22   More information can be found on: 

http://www.eif.org/what_we_do/equity/paneuropean_venture_capital_fund_of_funds/index.htm  

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operations  in  view  of  the  pressure  to  deliver  on  the  EFSI.  As  for  ESIF,  the  independent 
evaluation  notes  that  some  stakeholders  found  that  those  funds  compete  with  the  EFSI,  in 
particular in cohesion countries.  

the  EIB  and 

However,  both 
the  Commission  evaluation  see  strong  potential  for 
complementarities  and  synergies  between  all  of  those  funds  and  the  EFSI.  In  particular, 
resources from the CEF and H2020, and similarly the ESIF, could finance the first-loss piece 
of EFSI operations, where it is needed to take projects off the ground and maximise private 
sector contributions, while the EIB, with EFSI support, could finance mezzanine tranches. In 
this respect, the financing structure for the EFSI 1.0  included the transfer of EUR 500 million 
from the CEF financial instruments to the grant part of the CEF. The EIB and the independent 
evaluations find that the limitations to the combination of the ESIF with EFSI support need to 
be assessed, including the possible role for advisory services. Beyond the guidance23 provided 
by the Commission  on how EFSI  and ESIF can be  combined,  the Commission has  tabled a 
proposal24  to  facilitate  such  combination.  The  Commission  is  committed  to  continuing  the 
work to ensure an improved level playing field for the various  EU instruments. 

Cooperation with NPBs and Investment Platforms 

The  EIB  evaluation  shows  that  around  one-third  of  EFSI  operations  involved  co-
financing from NPBs. This is in line with the announcements by various Member States 
to  contribute up to  EUR 42 billion to  EFSI projects or Investment  Platforms. The EIB 
Group has also developed several initiatives to better respond to the needs of NPBs, including 
an equity platform25,  a securitisation initiative26 and a range of new financial products27.  

According to the independent evaluation, in some cases the EFSI competed with NPBs for the 
same project, in particular for larger projects. This risk should be mitigated through the EIB 
taking  subordinated  positions  in  EFSI  co-investments  with  NPBs.  Despite  their  potential  to 
address the high  demand for risky financing of smaller  projects, the independent  evaluation 
also notes that at the cut-off date of the evaluation, no Investment Platform had been set up. 
The  first  Investment  Platform  was  established  after  30  June  2016.  Further  Platforms, 
including in the SME window, are in the pipeline and are expected to be approved still this 
year.   

23  
24  
25  

26  

27  

http://ec.europa.eu/regional_policy/sources/thefunds/fin_inst/pdf/efsi_esif_compl_en.pdf  
COM(2016) 605 final. 
EIF-NPI equity platform. More information can be found on: 
http://www.eif.org/what_we_do/equity/NPI/index.htm  
EIF and NPIs Securitisation Initiative. More information can be found on: 
http://www.eif.org/what_we_do/guarantees/ENSI/index.htm. The EIF has for example signed a 
Memorandum of Understanding with Cassa Depositi e Prestiti (Italy) and is in the process of signing 
further Memoranda. 
http://www.eib.org/efsi/how-does-a-project-get-efsi-financing/index.htm 

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►Addressing geographic and sectorial distribution of EFSI support and 
complementarity with other sources of Union funding in the EFSI 2.0 proposal 

EFSI  2.0  will  extend  the  duration  of  the  EFSI  until  the  end  of  the  current  Multiannual 
Financial Framework and should provide a total of at least half a trillion euro of investments 
by  2020.  The  proposal  is  consistent  with  the  revision  of  the  Financial  Regulation  that  the 
Commission proposed at the same time to set up a robust framework for the management of 
the  financial  liabilities  of  the  Union.  In  order  to  enhance  the  firepower  of  the  EFSI  even 
further and to reach the stated aim of doubling the investment target, the Commission calls on 
Member States to also contribute as a matter of priority.  

Furthermore, an important objective of the EFSI 2.0 proposal is to reinforce the take-up of the 
EFSI in less-developed regions and transition regions. The support to less-developed regions 
and transition regions in Europe is therefore enlarged by an explicit reference to any industry 
that  would  not  otherwise  be  covered  in  the  general  objectives.  In  addition,  EFSI-support  to 
motorways, which should be in general avoided would be allowed in cohesion countries under 
certain conditions. It is critical that Member States develop the capacity to prepare projects. 
EFSI 2.0 will enhance technical assistance through the Advisory Hub. The use of the services 
provided by the Advisory Hub can also contribute to strengthened planning and coordiation of 
key investment projects at national level. 

An easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and 
the  Connecting  Europen  Facility  (CEF)  with  EFSI  support  is  also  a  key  element  and  may 
contribute  to  mobilising  additional  private  sector  investment.  In  September  2016  the 
Commission  therefore  adopted  a  proposal28  for  an  omnibus  Regulation  amending  several 
Regulations  to  facilitate  such  combinations    at  the  level  of  Investment  Platforms  as  well  as 
regards  individual  projects.  The  Commission  also  has  proposed  in  its  EFSI  2.0  proposal  to 
improve the EFSI’s focus on EU political priorities as regards climate change, for example by 
setting a minimum target forclimate-friendly projects under the Infrastructure and Innovation 
window of the EFSI. Moreover, the Commission recognises the importance of using part of 
the Union budget, such as the one available under the CEF, in the form of grants for blending 
with the EFSI. In this respect, a CEF blending call will be launched early in 2017 to combine 
EUR 1 billion grants with EFSI and financing from NPBs and the private sector. 

The EFSI is promoting social entrepreneurship and, thus, has an important social dimension. 
A  comprehensive  set  of  innovative  financial  instruments  under  the  EFSI  SME  window, 
aiming to support social entrepreneurship, sustainable employment and social innovation has 
been  developed.  They  include the  enhancement  of  the  Employment  and  Social  Innovation29 
guarantee on loans to microenterprises and social enterprises as well as an equity product for 
EIF  investments  in  support  of  social  enterprises  including  co-investments  with  business 

28  
29  

COM(2016) 605 final. 
EU Programme for Employment and Social Innovation. More information available at 
http://ec.europa.eu/social/main.jsp?catId=1081  

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angels and investments in or alongside intermediaries linked to social incubators, accelerators 
and payments-by-results schemes.  

Finally, under the EFSI 2.0 proposal, the EIB and the EIF are called upon to ensure that the 
final beneficiaries, including SMEs, are informed of the existence of EFSI support. 

Governance 

The  EIB  and  the  independent  evaluations  find  that  the  governing  bodies  of  the  EFSI 
have  been  set  up  and  are  functioning  well.  The  recommendations  include  making  some 
improvements,  including  clarifying  the  respective  roles  and  responsibilities  of  the  EFSI 
Managing Director’s office, the EFSI Secretariat and EIB services. The EIB evaluation also 
recommends to improve the lines of communication amongst EFSI’s governing bodies. The 
independent evaluation further recommends to review and streamline the procedures for EFSI 
operations.   

► Addressing governance in the EFSI 2.0 proposal 

EFSI 2.0 will enhance transparency in the investment decisions and governance procedures. 
The  Investment  Committee  will  have  to  further  explain  in  its  decisions,  which  are  made 
public,  the  reasons  why  it  deems  that  a  particular  operation  should  benefit  from  the  EU 
guarantee, in particular as regards additionality. In addition, the scoreboard of indicators will 
be  published  once  an  operation  is  signed  under  the  EU  guarantee.  Moreover,  the  EFSI  2.0 
proposal also envisages an obligation for the EIB and the EIF to inform the final beneficiaries, 
including  SMEs,  that  they  received  EFSI  support,  or  require  the  relevant  financial 
intermediaries to do so.  

Moreover, it will be explored whether certain procedures for the approval processes of EFSI 
operations can be further streamlined. 

Functioning of the EU guarantee and the guarantee fund 

Both  the  Commission  and  the  independent  evaluation  find  that  the  EU  guarantee  has 
been relevant, efficient and effective in enabling the EIB Group to increase considerably 
its  volume  of  EIB  Special  Activities  and  EIF  guarantees  in  favour  of  SMEs  and  mid-
caps. The EU guarantee has also proven to be a flexible instrument that can adapt to emerging 
needs,  with  for  instance  the  reinforcement  of  the  SME  window  of  the  EFSI  by  EUR  500 
million. The independent evaluation nonetheless finds that the procedures on the decision of 
the use of the EU guarantee should be further clarified and monitored in greater detail.  

The independent evaluation notes that the targeted provisioning of the guarantee fund of 50% 
at  the  outset  seems  to  be  cautious  and  prudent  to  cover  potential  losses  on  the  existing 
portfolio and recommends to closely monitor the investment strategy of the resources held in 

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the  EFSI  Guarantee  Fund.  The  Commission  evaluation  assesses  the  risks  of  the  different 
products  supported  by  the  EU  Guarantee.  It  concludes  that  overall  the  Union  budget  would 
also  be  adequately  shielded  from  potential  calls  under  the  EU  Guarantee  with  an  adjusted 
target  rate  for  provisioning  the  Guarantee  Fund  of  33.4%,  taking  into  consideration 
recoveries, revenues and reflows from EIB operations. 

The Commission evaluation also stressed that, given that the ability of the EIB to implement 
risk-sharing  instruments  and  take  subordinated  positions  is  key  to  enhance  the  capacity  of 
private  sector  investors  to  support  riskier  and  more  innovative  projects  as  well  as  SMEs,  a 
strong  emphasis  should  be  put  on  subordination.  Finally,  the  Commission  evaluation  finds 
that the EU Guarantee was not designed to cover the potential impact of currency fluctuations. 
That gap has a bearing on the capacity of the EIB to deliver long-term fixed-rate financing in 
certain  non-euro  countries  with  less  developed  financial  markets,  thereby  potentially 
negatively affecting the geographic coverage of the EFSI. 

► Addressing the EU Guarantee and the Guarantee Fund in the EFSI 2.0 proposal 

The  Commission  evaluation  concluded  that  the  Union  budget  would  also  be  adequately 
shielded  from  potential  calls  under  the  EU  Guarantee  with  an  adjusted  target  rate  for 
provisioning the Guarantee Fund of 33.4% (from 50% currently). An adjusted target rate of 
35%  is  reflected  in  the  Commission  proposal  for  EFSI  2.0.  In  line  with  the  Commission 
evaluation, the EFSI 2.0 proposal also includes a stronger focus on risk-sharing instruments 
and  subordinated  financing  and  the  possibility  for  the  EU  Guarantee  to  cover  the  potential 
impact of currency fluctuations.   

Communication 

Overall, the three evaluations stress the need for enhanced communication on the EFSI. 
The independent evaluation recommends to raise awareness further – in particular at the local 
level – on the EFSI support and its products, notably for new products in order to ensure their 
quick take-up. It also recommends to better communicate and explain the possibilities for the 
set-up of Investment Platforms, including the EIB’s role in this respect.  

The  independent  evaluation  also  notes  that  communication  methods  could  be  improved 
internally, within the EIB Group and EFSI governance structures. 

► Addressing communication in EFSI 2.0 

The recommendations relating to enhanced communication do not require an amendment of 
the EFSI Regulation and will be addressed through enhanced efforts by both the Commission 
and  the  EIB.  The  Commission  will,  in  close  cooperation  with  the  EIB  Group,  further 
strengthen the communication on the EFSI in order to raise awareness about the availability 
of  funding  and  technical  assistance  across  the  EU.  Communication  efforts  are  ongoing  and 
will  be  further  enhanced  in  the coming  months.  Information  on  funding  solutions,  technical 

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assistance  and  procedures,  including  through  good  practice  examples  and  case  studies,  can 
stimulate  new  ideas  and  boost  investment  initiatives.  Given  the  crucial  importance  of 
continuously updated and easily accessible information on all aspects of the Investment Plan 
for Europe, in all its aspects, further communication efforts will be made both at the EU level, 
as part of the Commission’s corporate communication efforts, and in particular, at the local, 
regional and national levels. 

3.  HOW  HAS  THE  EIAH  PROVIDED  TECHNICAL  ASSISTANCE 

SO FAR? 

Relevance and effectiveness 

The independent evaluation confirms the relevance of the EIAH given the high need for 
technical assistance, which is expected to grow in the coming years. The evaluation notes 
a good coverage of EIAH support with 214 requests coming from 27 Member States during 
the evaluation period. It has been most effective in providing services in the energy, transport 
and  urban/rural  development  sectors.  Through  a  more  pro-active  stance  of  the  EIAH, 
additional sectors are expected to be covered in the future. Out of the 214 requests, 78 related 
to  financing  or  funding  advice,  78  to  technical  assistance  and  funding,  13  to  proposed 
cooperation  and  33  to  general  information.  Appropriate  expertise,  where  necessary,  was 
mobilised  either  from  EIB  operational  services  or  from  relevant  advisory  services  and 
programmes.  

Overall, the independent evaluation concludes that it is too early to assess the effective use of 
existing expertise by the EIAH. The preliminary analysis however points to the need for the 
EIAH  to  have  a  more  regional  and  local  presence.  Although  it  is  already  active  locally  for 
specific projects, the EIAH needs to develop further local capacity or partnerships with NPBs 
and local service providers – in particular in regions where this support is most needed. The 
evaluation  also  highlights  the  need  for  more  advisory  support  on  the  establishment  of 
Investment Platforms.  

Finally,  the  independent  evaluation  notes  that  there  is  still  room  for  clarifying  and  further 
shaping  the  overall  cooperation  between  NPBs  and  the  EIAH.  At  the  cut-off  date  of  the 
evaluation, 18 Memoranda of Understandings (MoU) had been signed between the EIAH and 
NPBs.  One  MoU  was  also  signed  with  the  International  Union  of  Railways.  Their 
implementation  should  be  steered  and  monitored,  including  by  following  up  on  the 
administrative  arrangements  for  the  services  provided  by  decentralised  organisations  under 
the  EIAH  umbrella.  Special  attention  should  be  paid  to  countries  that  have  less  technical 
assistance capacity. 

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Efficiency 

According  to  the  independent  evaluation,  it  is  too  early  to  draw  conclusions  on  the 
efficiency  of  the  EIAH.  No  issues  have  been  identified  with  its  governance  model,  and  a 
higher  absorption  of  the  budget  is  expected  as  the  implementation  of  the  EIAH  continues, 
with the expectation that the full budget will be spent.  

However, the independent evaluation also sees a need to decentralise the EIAH’s provision of 
services, underlining existing positive experience with local technical assistance and support 
in some Member States. The EIB evaluation notes that the EIAH could contribute further to 
the EFSI, including through the identification of potential EFSI projects, advisory support to 
individual  EFSI  projects,  and  possibly  support  to  dissemination  and  promotional  activities 
(see below), particularly for Investment Platforms. 

Added value 

The  independent  evaluation  finds  that  the  EIAH  does  not  overlap  with  other  advisory 
services  within  the  EIB,  with  most  of  its  services  considered  to  be  unique.  Potential 
overlaps with service providers from the private sector should be monitored. The independent 
evaluation notes that the stakeholders consulted provided mixed feedback on the quality of the 
services  provided  to  them  in  the  early  stage  of  the  EIAH  development.  In  particular,  the 
evaluation  recommends  that  the  EIAH  should  develop  more  tailored  services  and  speed  up 
response  times,  which  some  stakeholders  perceive  as  being  too  long.  The  evaluation  also 
recommends  establishing  a  structured  feedback  procedure,  so  that  the  EIAH  can  take  into 
account the opinion of stakeholders to constantly improve its services.  

Communication 

The EIAH website is considered to be a good access point for requests with 70% of the 
requests  having  been  submitted  through  the  website.  Similarly  to  the  conclusions  drawn 
for the EFSI, the independent evaluation recommends to signficantly ramp up communication 
on the EIAH given that the awareness of  the services it provides is still relatively limited.  

► Addressing Technical Assistance reinforcement in the EFSI 2.0 proposal 

The EIAH has made an overall positive start. As stressed by the independent evaluation, it is 
too  early to draw definite  conclusions on the functioning  of the EIAH and more experience 
will be gained as its implementation moves forward. The Commission proposal on EFSI 2.0 
nonetheless includes a number of targeted enhancements of the EIAH, which respond to most 
of  the  recommendations  of  the  independent  evaluation.  It  is  worth  noting  that  the 
recommendations  relating  to  enhanced  communication  do  not  need  to  be  addressed  through 
legislative changes. Work is on-going to raise awareness of the EIAH further.  

The Commission proposal foresees that the EIAH should not only leverage local knowledge 
to  facilitate  EFSI  support  across  the  Union,  but  also  contribute  to  the  objective  of  sectorial 
and  geographical  diversification  of  the  EFSI,  in  particular  by  supporting  the  EIB  in 
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originating  operations.  This  is  in  line  with  the  recommendations  made  by  the  independent 
evaluation. The Commission also stresses in its proposal that the co-operation with NPBs and 
the  managing  authorities  of  ESIF  should  further  enhance  the  provision  of  advisory  support, 
financial and technical expertise at the local level, in particular in those Member States which 
face  difficulties  in  making  use  of  innovative  financing  mechanisms.  A  clear  link  is  made 
between such co-operation and local support, including on the combination of other sources 
of Union funding with the EFSI. This will not only help project promoters to structure their 
projects in a better way, but should also contribute to achieving a better geographic balance of 
the EFSI.  

In addition, in view of their importance for the financing of smaller projects, the Commission 
proposes that the EIAH should provide pro-active support on the establishment of Investment 
Platforms. That proposal responds to the evaluations, which have pointed to the need of more 
clarity and advice on the establishment of such Platforms.  

Finally, the EFSI 2.0 proposal also foresees that the EIAH should support the preparation of: 
climate  action  and  circular  economy  projects  or  components  thereof,  in  particular  in  the 
context  of  COP21,  projects  in  the  digital  sector,  as  well  as  cross-border  projects.  This  is  in 
line with the EU priorities to fight climate change, to develop a Digital Single Market, and to 
promote cross-border projects considering their high added value for the Union.  

4.  OPINION OF THE COURT OF AUDITORS 

In  line  with  the  requirements  of  the  EFSI  Regulation30,  the  Court  of  Auditors  issued  an 
opinion on the Commission evaluation of the use of the EU guarantee and the functioning of 
the  EFSI  Guarantee  Fund.  The  Court  of  Auditors  finds  that  the  Commission’s  main 
conclusion, namely the proposed adjustment of the provisioning of the EFSI Guarantee 
Fund from 50% to 35%, is in line with the updated estimate of expected losses.  

In addition to the EFSI Regulation requirement, the Court of Auditors also assessed the other 
elements of the EFSI 2.0 proposal. The main elements of this assessment are the following: 

  On timing, the Court of Auditors is of the opinion that it is too early to propose an increase 
of  the  EU  budget  guarantee.  The  Commision  believes,  however,  that  building  on  the 
success achieved and taking into account that the legislative process may take some time, 
its proposal allows for a smooth continuation of the operations and sends a clear signal to 
investors and project promoters. In a still subdued investment environment, such certainty 
is  crucial  to ensure that jobs,  growth  and  investment continue to  be  supported across  the 
Union.  The  October  European  Council31  also  called  on  Member  States  to  agree  their 

30  
31  

Article 18(2) of Regulation (EU) 2015/1017. 
EUCO 31/16. 

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negotiating position on the Commission proposal at the ECOFIN meeting on 6 December, 
taking into account the external evaluation32. 

  On  evidence,  the  Court  of  Auditors  believes  that  more  evidence  is  needed  to  justify  the 
increase of the EU guarantee. The Commission notes that the EFSI 2.0 proposal is based 
on the experience and lessons learnt during the first year of implementation. As set out in 
the  Communication  of  1  June  201633,  the  results  after  the  first  year  were  positive.  More 
specifically, given the high market demand, the Commission proposed that part of the EU 
guarantee  allocated  to  SMEs  should  be  increased.  Considering  that  infrastructure  and 
investment  projects  take  more  time  to  mature,  not  increasing  the  guarantee  for  the  SME 
window would have meant foregoing an extra effort to boost investment and to create jobs 
and growth in Europe. 

  On additionality, the Court of Auditors is of the opinion that the additionality criterion is 
too  broadly  defined.  One  of  the  key  elements  of  the  EFSI  2.0  proposal  is  to  reinforce 
additionality. The Commission proposes that projects under the EFSI must address market 
failures  or  sub-optimal  investment  situations  as  part  of  the  eligibility  criteria  for  EFSI 
support. In addition, a more detailed definition of additionality has been proposed, so as to 
increase  transparency  on  the  compliance  of  projects  with  this  crucial  criterion.  The 
Commission also addresses a concrete bottleneck to investments of high EU added value, 
by considering cross-border infrastructure projects  (and related services) as  additional by 
definition. 

  On  governance  and  transparency,  the  Court  of  Auditors  expressed  support  for:  (i)  the 
proposal  to  include  a  provision  on  tax  avoidance;  (ii)  the  proposals  to  take  action  on 
reinforcing  the  Hub  and  the  EFSI’s  increasing  sectoral  coverage;  (iii)  the  proposals  to 
reinforce the governance structure of the EFSI, in particular as regards the management of 
potential conflicts of interest of the Investment Committee members. 

5. 

CONCLUSION 

The Commission notes that three evaluations mandated by the EFSI Regulation, including the 
external,  independent  evaluation,  have  been  presented  in  time  to  inform  the  legislative 
process. The three evaluations concur on the success of the EFSI and the EIAH so far and on 
the  need  to  reinforce  these  initiatives  as  regards  specific  aspects  (additionality,  technical 
assistance, combination with other EU funds), which have already been addressed in the EFSI 
2.0 proposal. 

The  Commission  considers  that  the  EFSI  is  achieving  its  objectives  and  that  maintaining  a 
scheme for supporting investment is warranted.34 The Commission will continue to cooperate 

32  

33  
34   

Published on 11 November 2016, available at https://ec.europa.eu/priorities/publications/independent-
evaluation-investment-plan_en  
COM (359) final. 
See Article 18(7) of Regulation (EU) 2015/1017. 

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closely with the EIB Group to build on this success. The Commission therefore invites the co-
legislators  to  deal  with  the  EFSI  2.0  proposal  as  a  matter  of  priority,  as  recalled  by  the 
October  European  Council,  that  called  for  a  Council  position  in  the  Ecofin  Council  on  6 
December,  in  order  to  address  quickly  the  issues  identified  in  the  different  evaluations  and 
deliver an even higher volume of high-quality investments.  

The Commission will continue to support the European Parliament and the Council during the 
legislative  negotiations  and  will  continue  its  dialogue  with  all  relevant  stakeholders  to 
reinforce  and  consolidate  the  Investment  Plan  for  Europe.  At  the  same  time,  work  at  the 
national as well as the European level, to ensure that the business environment is as conducive 
to investments as possible, should be continued.  

The Commission will also draw on the experience with the implementation of the EFSI in the 
upcoming discussions on the new Multiannual Financial Framework. 

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