A connected, resource efficient and low-carbon transport system is essential for the future competitiveness of Europe. There remains a significant investment gap for EU transport investment, and the European Fund for Strategic Investments (EFSI) as the central pillar of the Investment Plan, or so-called Juncker Plan, is helping to address this gap. The transport sector faces significant challenges in attracting sufficient funding for pipeline building, planning and structuring. The EFSI could help in all of these areas.
EFSI in combination with other EU funds
The EFSI is just one of many EU financing tools available to project promoters in the transport sector. The Connecting Europe Facility (CEF) also has a significant impact both in terms of grants and financial instruments. CEF grants have leveraged over €40 billion investment and the CEF Debt Instrument and its legacy instruments have mobilised since 2014 more than €4.5 billion of investment.
Sustained investments from all sources are required to complete this goal through supporting the completion of the Trans European Network – Transport (TEN-T) Core Network, deploying key EU-wide connectivity (through Single European Sky ATM Research (SESAR) and European Railway Traffic Management System (ERTMS)), and driving the adoption of new and innovative technologies.
To further support the participation of private sector investment in the financing of TEN-T projects, €1bn CEF grants have been made available for privately-financed, including EFSI, transport project through the recent CEF Blending Call. It is very promising that at the first deadline the call was 2.2 times oversubscribed.
Technical support and visibility for projects
The Investment Plan, or so-called Juncker Plan, encompasses far more than the provision of a guarantee to unlock additional investments through the EFSI. The transport sector can also benefit from the other elements of the Plan.
As for all sectors, project promoters in the transport sector can seek technical assistance through the European Investment Advisory Hub (EIAH). The Hub offers a single access point for advisory and technical assistance services to allow promoters to get their projects off the ground.
The European Investment Project Portal– the #InvestEU Portal – is a platform to boost the visibility of investment opportunities, including those in the transport sector, across Europe. The aim of the Portal is to bring together project promoters seeking investment with investors seeking projects.
Examples of EFSI projects in the transport sector
The European Investment Bank (EIB) has provided loans of €280 million to Fraport in Greece to help finance the upgrading of 14 regional airports which served a total of around 25.2 million passengers in 2016. The loan will be used for the refurbishment and modernisation of terminals, and the improvement of safety and airfield infrastructure. The investments will support the development of the tourism industry, a key driver of the Greek economy.
The EIB has signed a EUR 50 million loan to finance a new, high-capacity bus network in Las Palmas de Gran Canaria. In addition to the construction of a new 11.7 kilometre high-capacity bus route, the project will finance the acquisition of 17 new eco-friendly hybrid or electro energy buses, the construction of three new bus stations and a traffic control centre. The plan also includes the construction of new cycling lanes and the improvement and the widening of pavements close to the bus lanes. More than 1,000 jobs are set to be created during the construction phase of the project. The network is expected to be fully operational by 2021.
The EIB is lending this project PLN 400 million (around €93m), while the Polish national promotional bank, BGK, is providing additional support of PLN 298m (around €69.3m). The Łagiewnicka Route, consisting of 3.7 km of dual carriageway ring-road including tunnels and a new 1.7 km tram line, is a key project contributing to reducing congestion in Kraków. Improving the quality of public transport services in terms of speed, comfort and reliability, this project will also reduce reliance on private cars and so contribute to the reduction of air pollution.