Looking Ahead

2022 will see the launch of InvestEU and a decisive shift towards thematic investments. It will also be a year in which we expect to continue to grow our private fund-raising arm, attracting more private resources to serve public policy objectives alongside good returns.

Wrapping up the EGF, we will be turning our attention to the Recovery and Resilience Facility (RRF) mandates and also intensifying our efforts in the key thematic areas of climate action and environmental sustainability, digitalisation and social inclusion.

Ultimately, with our PPGs and our thematic orientation in place, we will be in a better position to serve our European, national and regional partners in translating policy objectives into concrete financial support on the ground, helping European businesses as we transition together to a greener, digital and more inclusive future.

InvestEU

Building on the success of EFSI, InvestEU is the EC’s flagship investment programme for the current multiannual financial framework covering the period 2021 to 2027. Of a total EU budgetary guarantee of €26.2bn for all Implementing Partners, €11.1bn of the InvestEU guarantee will be attributed to the EIF, making us the single largest implementing partner under InvestEU in terms of the amount of InvestEU guarantee allocated.

Together with the EIB Group own resources deployed alongside EIF InvestEU products, the EIF is expected to deploy up to €20bn of InvestEU-backed financing over the next six years.

With negotiations coming to an end, the guarantee agreements with the EIB and the EIF are expected to be signed in early 2022, followed by the first calls for expression of interest for financial intermediaries, to be launched by the EIF.

In addition to InvestEU budgetary resources, the EIF has been exploring the possibility of additional allocations from the various sectoral programmes to be delivered through InvestEU. To date, the EC has already earmarked close to €900m of such contributions for blending with InvestEU equity interventions. Further sectoral contributions are expected to be secured in the future for both guarantee and equity thematic interventions, with discussions continuing in 2022.

One dimension of particular interest is the fact that it is expected to be the first EIF-managed initiative focusing on strengthening women’s economic empowerment and boosting their participation in the VC/PE fields in particular, thus making a very tangible contribution to gender diversity and inclusiveness.

AMUF update

Efforts on the private fundraising front will continue and intensify in the course of 2022, providing a much-needed boost to attracting private resources into VC/PE while at the same time pursuing EU public policy objectives.

The second generation of funds - AMUF Generation II - was launched in 2021 and is now open for fundraising. It builds on the success of AMUF I and will maintain the same three thematic compartments: Growth, Tech VC and Life Science VC.

On the SDUF front, following the launch of the Social Impact and Health compartments, two new compartments are being prepared, focusing on Climate Tech on the one hand and developing a COVID-response Digital Platform on the other. Both are expected to open for fundraising in the first half of 2022.

In parallel, we are looking at a new model of cooperation to offer another attractive proposition to private investors and draw more resources into supporting EU policy priorities. Namely, beyond tailor-made funds or ready-made funds like AMUF/SDUF, the EIF is looking to develop institutional investor partnerships. This will be a hybrid model including an investment into AMUF/SDUF and co-investments alongside AMUF/SDUF.

Recovery and Resilience Facility

RRF is the centrepiece of NextGenerationEU, the recovery instrument that, alongside the EU budget, forms the largest stimulus package ever financed by the EU. The RRF’s priority is to ensure a sustainable and inclusive recovery that promotes green and digital transitions. It offers an unprecedented opportunity to speed up the recovery in Europe and reinforce the commitment to the twin green and digital transitions. This year marked the finalisation of most Member States’ Recovery and Resilience Plans. Several of those include financial instruments and the EIF is looking to play an important role in the deployment of such facilities.

While 2021 saw the conclusion of negotiations for an RRF mandate in Romania, there are proposals and discussions ongoing in various other EU Member States like Cyprus (first ever equity mandate), Bulgaria and the Czech Republic, where the EIF hopes to be in a position to make a meaningful contribution to helping Member States maximise their support for SMEs on the road to recovery.

As policy priorities increasingly focus on the green transition, climate action, environmental sustainability, digitalisation and social inclusion, our thematic transformation will ensure that we are in a strong position to design financial instruments that are effective on the ground in both supporting SMEs financially and achieving these policy objectives at the same time.

EGF

The market situation related to the COVID-19 crisis has called for an important public intervention in the support of access to finance for European companies. During 2021, more than 85% of EIF’s activity centred on the deployment of this emergency instrument. In 2022 the EIF plans to conclude the deployment of this initiative, particularly through the implementation of a securitisation instrument.

Group Alignment Implementation Plan

Since December 2020, the EIF and the EIB have been working on the Group Alignment Implementation Plan – GAIP. The GAIP aims at achieving a stable, productive and well-functioning relationship across various areas of interaction. The intention is to improve efficiencies at Group level and better equip both institutions for existing demands, as well as the challenges ahead. This plan includes a total of 75 projects and initiatives which require close cooperation within the EIF and at Group level. The GAIP is accompanied by a set of General Principles and Guidelines, established by the EIF and the EIB, that apply to all GAIP projects. While substantial progress has already been made by delivering more than 25% of the projects, work will continue throughout 2022 to ensure successful implementation of the GAIP, specifically in the risk management area.

Climate & Cohesion targets

In the context of Paris Alignment, the EU Green Deal and the Climate Bank Roadmap, the EIF plans to progressively scale up investments that will make a relevant contribution to both the EU’s and the EIB Group’s climate targets, by investing in infrastructure funds targeting climate adaptation or mitigation, as well as environmental sustainability, energy, transport, environment, digital connectivity, space and social infrastructure.

The EIF intends to target 16% of its activity to climate and environment in 2022 and increase this share to 22% and 25% in 2023 and 2024 respectively.

Additionally, to support the EU Cohesion policy that is focused on correcting economic imbalances across countries and regions, in 2022 the EIF will implement a new KPI that will measure the reach of our activity to cohesion regions. The intention is to dedicate 38% of our investments to cohesion regions in 2022.

Subsequent events: While the ultimate impact of the invasion of Ukraine by the Russian Federation is difficult to predict at the time of writing, the evolution of the conflict is being closely monitored for potential impacts on the EIF’s portfolio, including the effect of possible further sanctions. The Russian Federation, Belarus and the Ukraine do not fall within the ordinary geographical scope of EIF activities, with relevant EIF exposures being very limited. Furthermore, the EIF applies robust compliance controls, including as to sanctions, in line with the EIB Group’s Sanctions Compliance Programme.

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