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THE STATE OF THE EUROPEAN UNION
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through the EIB and the European Investment
Fund. The instrument will be run by a board
formed by the European Commission and the
EIB. The selection of projects will be carried out
transparently, with a strong component of tech-
nical assistance.
The European Commission estimates that
the investment plan that the EFSI is to catalyse
will have an impact on the rate of GDP growth
of between 2.5 and 3.1 percent, with the crea-
tion of 1.3 million new jobs, in the period 2015
to 2017. It may be extended to 2020. The prior-
ity sectors are infrastructure, including broad-
band networks and energy, energy efficiency,
renewable energies, transport in industrial cen-
tres, education, research and financing SMEs.
A plan is also afoot to use the structural and
investment funds already budgeted for the pe-
riod 2014 to 2020 as loans, capital contribu-
tions to projects and guarantees, instead of em-
ploying them as subsidies, thereby magnifying
their impact by between three and four times to
hit 35 billion euros in 2017.
The selection criteria are as follows:
– Added value for meeting the EU’s goals.
– Economic viability, prioritising projects with
high socioeconomic returns.
– Possibility of a prompt start.
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Possibility of having other sources of financ-
ing.
The member states will be able to take part
if they wish. Any contributions will not be in-
cluded in the deficit and debt calculations. The
door is also open to the participation of nation-
al development banks (such as Spain’s ICO, for
example).
It is certainly positive that the governance of
new EFSI will not have an intergovernmental
structure. Instead, it will be under the aegis of
the Commission and the EIB, which strengthens
the community institutions and prevents the
proliferation of parochial projects. The structure
will not change in the event of national contri-
butions, hence the creation of an independent
board for the selection of projects that will not
be made up of 28 representatives of the states.
The weakest point of Juncker’s proposal is
undoubtedly the leverage ratio of 15 to 1. By
using the community budget to raise private
capital, doubts are cast on the increase in new
public resources, except for the input of capital
by the EIB (5 billion euros). This comes from not
having required obligatory state contributions
nor having raised the idea of an increase in own
resources.
If it is to be credible, the EFSI must have
more public resources, which can be obtained
either from the profits of the ECB (which are set
to increase significantly with the asset buying
programme), from FTT revenue, or even through
the issue of European public debt by the Union
(which requires the repeal of Article 17.2 of
Regulation 976/2012).
Conclusions and recommendations
The European Union has to furnish itself with an
integrated financial system. In other words, it
has to put a stop to financial fragmentation,
which is particularly apparent in the different
rates of interest on retail credit according to the
member state, or in such odd situations as re-
quiring an address in the country in order to
open a bank account, the different commissions
charged depending on whether the transaction
is domestic or cross-border, or even the cancel-
ling of payment card services because the cus-
tomer moves to another member state. On this
point, Spain must swiftly transpose European
Parliament and Council Directive 2014/92/EU
of 23 July 2014 on the comparability of fees