Financial Instruments in Cohesion Policy
Financial instruments represent a resource-efficient way of deploying cohesion policy resources in pursuit of the Europe 2020 Strategy objectives. Targeting projects with potential economic viability, financial instruments provide support for investments by way of loans, guarantees, equity and other risk-bearing mechanisms, possibly combined with technical support, interest rate subsidies or guarantee fee subsidies within the same operation.
Smarter use of EU resources: financial instruments in EU funds already halfway to target - (07/02/2018)
New data uploaded on the Cohesion Open Data Platform show that half of the European Structural and Investment (ESI) Funds envelope planned to be invested via financial instruments over the 2014-2020 budget period has already been allocated to generate additional investment through financial products such as loans, guarantees or equity.
By end 2016, already €10.3 billion from the ESI Funds was committed to such instruments, mostly for SME support, research and innovation and the low-carbon economy, out of a target of €21 billion.
The new "financial instrument" data of the Cohesion Open Data Platform will enable viewers to follow the progress made towards the target on an annual basis and by country.
Commissioner for Regional policy Corina Crețu said: "Over 76,000 businesses are currently supported by the European Structural and Investment Funds through financial instruments; these innovative tools have proven their ability to deliver for the maximum impact of EU resources on the ground, in line with the objective of President Juncker's Investment Plan."
Find the full summary of progress in ESI Funds investments via financial instruments here.
Besides the obvious advantages of recycling funds over the long term, financial instruments help to mobilise additional public or private co-investments in order to address market failures in line with Europe 2020 and cohesion policy priorities. Their delivery structures entail additional expertise and know-how, which helps to increase the efficiency and effectiveness of public resource allocation. Moreover, these instruments provide a variety of incentives to better performance, including greater financial discipline at the level of supported projects.
Financial instruments have been used for delivering investments for Structural Funds since the 1994-1999 programming period. Their relative importance has increased during the programming period 2007-2013 and they now represent around 5 % of total European Regional Development Fund (ERDF) resources. In the light of the current economic situation and the increasing scarcity of public resources, financial instruments are expected to play an even stronger role in cohesion policy in the 2014-2020 programming period.
- What is the aim?
- Key features of the new legal and policy framework?
- What has changed from 2007-2013?
- What are the practical effects?
ESIF and EFSI complementarities
- European Structural and Investment Funds and European Fund for Strategic Investments complementarities: Ensuring coordination, synergies and complementarity
- Financial instruments under the European Structural and Investment Funds: Summaries of the data on the progress made in financing and implementing the financial instruments for the programming period 2014-2020 in accordance with Article 46 of Regulation (EU) No 1303/2013 of the European Parliament and of the Council
- fi-compass is designed to meet the needs of ESIF managing authorities, EaSI microfinance providers and other interested parties, by providing practical know-how and learning tools on financial instruments.
- Financial instruments in ESIF programmes 2014-2020 - A short reference guide for Managing Authorities
- Review of the Role of the EIB Group in European Cohesion Policy
- 'EC regulatory guidance and manuals are available on www.fi-compass.eu/resources
DataView the data
European Commission - DG Regional Policy
Unit B3 - Financial Instruments and relations with International Financial Institutions
Avenue de Beaulieu 5
Tel: 32 2 29 90808 / 59332
Fax: +32 2 292 0904
The legislative package for cohesion policy for 2014-2020 was adopted on 17 December 2013