Regulation 2021/523 - InvestEU Programme - Main contents

EN

Official Journal of the European Union

L 107/30

The COVID-19 pandemic is a major shock to the global and Union economy and is having a major social and economic impact across Member States and regions. Due to the necessary containment measures, economic activity in the Union dropped significantly. The contraction in Union GDP in 2020 is expected to be around 7,4 %, far deeper than during the financial crisis in 2009. Investment activity has dropped significantly. Vulnerabilities such as the over-reliance on non-diversified external supply sources and a lack of critical infrastructure need to be addressed, in particular for small and medium-sized enterprises (SMEs), including micro-enterprises, for instance by diversifying and strengthening strategic value chains, to improve the Union’s emergency response as well as the resilience of the entire economy, while maintaining its openness to competition and trade in line with its rules. Even before the pandemic, while a recovery in investment-to-GDP ratios in the Union could be observed, it remained below what might be expected in a strong recovery and was insufficient to compensate for years of underinvestment following the 2009 crisis. More importantly, the current investment levels and forecasts do not cover the Union’s needs for structural investment to restart and sustain long-term growth in the face of technological change and global competitiveness, including for innovation, skills, infrastructure, SMEs and the need to address key societal challenges such as sustainability and population ageing. Consequently, in order to achieve the Union’s policy objectives and to support a swift, sustainable, inclusive, lasting and healthy economic recovery, support is necessary to address market failures and suboptimal investment situations and to reduce the investment gap in targeted sectors.

Evaluations have underlined that the variety of financial instruments delivered under the 2014-2020 Multiannual Financial Framework period has led to some overlaps in their scope. That variety has also produced complexity for intermediaries and final recipients who were confronted with different eligibility and reporting rules. The absence of compatible rules also hampered the combination of several Union funds, although such combinations would have been beneficial in order to support projects in need of different types of funding. Therefore, a single fund, the InvestEU Fund, which builds on the experience of the European Fund for Strategic Investments (EFSI) set up under the Investment Plan for Europe, should be set up in order to provide more efficiently functioning support to final recipients by integrating and simplifying the financing offered under a single budgetary guarantee scheme, thereby improving the impact of Union support while reducing the cost to the Union payable from the budget.

In recent years, the Union has adopted ambitious strategies to complete the internal market and to stimulate sustainable and inclusive growth and jobs. Such strategies include ‘Europe 2020 – A strategy for smart, sustainable and inclusive growth’ of 3 March 2010, ‘Action...