BEYOND THE CYCLE TO INVEST FOR THE NEXT GENERATION Tanguy - - PowerPoint PPT Presentation

BEYOND THE CYCLE TO INVEST FOR THE NEXT GENERATION

Tanguy DESROUSSEAUX

Head of Public Sector & Infrastructure Financing for France Western Europe Department European Investment Bank

Paris, May 03, 2018

14/06/2018

Investment priorities perceived by EIB’s survey

• Investment trends observed in the private & public sectors:

 strong investments in the private sector into RDI & capacity expansion  reduced investments by local authorities due to budgetary constraints

• pipeline for substantial infrastructure investments, especially for transport
• Priority investments to overcome obstacles:

 investment in further education & training to mitigate lack of qualified staff  insufficient public transport in growing urban areas & environmental imperative

• digitalization of the economy underway, requiring investment in broadband

infrastructure & modernization of equipment (both private & public sectors)

• Specific investment objectives:

 improve the performance of production tools via RDI investments  municipalities aim to invest more into education & healthcare

• improve the energy efficiency of buildings (both private & public)

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EIB response to current investment needs

• Sustained level of lending in France with a focus education & innovation

 Plan Campus & Programme Colleges Compétences et Emplois Jeunes  RDI financing for mid to large caps  Financing of broadband deployment by operators & local authorities

• Special effort to support Climate Action or adaptation

 Renewable energy (photovoltaic, windfarms, biogas,…)  Energy efficiency of buildings (housing, education, public buildings, infrastructure)

• Enhance EFSI lending (Juncker Plan):

 New, smaller & riskier counterparts  More flexible lending criteria  Risk-sharing with intermediaries

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• 1. Education

DEPARTEMENT OF SEINE SAINT DENIS – 240M€

Financing of a multi-annual investment programme in education for higher education .

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Programme Collèges Compétences & Emplois jeunes (2013-2017): 13 Départements for a total lending volume of 1.3 Mrd€ in support of investments totaling 2.8 Mrd€ Plan Campus (2015-2018): 15 universities for a total lending volume

• f 1.3 Mrd€ in

support of investments totaling 3.3 Mrd€

ECOTITANIUM 30M€

First European facility for recycling and remelting aviation grade titanium metal and alloys scrap

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• 2. Research, Development & Innovation

SUNPARTNER TECHNOLOGIES -15 M€

The investment programme covers 2017-2020 and includes 2 manufacturing lines (150,000 m2 each), enhancing integrated photovoltaic (& smart) glass capacity.

LATECOERE AEROSTRUCTURE RDI – 55 M€

Product & process innovation related to doors,

• ptical networks, racks and

cockpits, cabin infrastructure & video systems. The project also covers the construction

• f a new advanced

manufacturing plant in Toulouse, France

NORD PAS DE CALAIS THD – 184 M€

Design, roll-out & operation of a publicly

• wned fibre broadband network PIN (Public

initiative network) covering areas not served by commercial operators in the ex-Nord-Pas-de-Calais Region.

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• 3. Broadband & telecommunications

TELCO – 25 M€ Upgrade & expansion of a mobile networks (3G and 4G) in La Réunion & Mayotte, including IT system components, in order to reach 95% population within 5 years.

VALECO RENEWABLE ENERGY 220 M€

Construction and

• peration of a portfolio of 8

windfarms and 2 solar photovoltaic power plants total 181MW

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SOREGIES ENERGY NETWORKS & RENEWABLE GENERATION – 70 M€

Refurbishment & extension of its gas & electricity networks, implementation of smart metering system & construction of new renewable capacity.

SIAH WATER TREATMENT AND SUPPLY MANAGEMENT – 76 M€

Expansion & upgrade

• f a wastewater

treatment plant, including production of biogas in Val d'Oise.

• 4. Renewable energy

ADESTIA EFFICACITE ENERGETIQUE LOGEMENT SOCIAL 200 M€ Réfurbishment (energy efficiency) of 24 500 social housing units owned by 13 social housing operators (ESH)

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• 5. Energy efficiency

ROLAND GARROS AIRPORT REUNION 100 M€

Development plan 2011-2022, with the common objective of alleviating current congestion & accommodating future growth in traffic, increasing climate resilience (flood protection) & improving environmental and safety performance.

EFSI in France

• France is among the top 3 countries benefitting from EFSI, 2nd in terms
• f approvals after Italy
• In 2017:

 34 % of EIB’s activity in France benefit from EFSI  56 new operations approved totalling 4.7 Mrd€  mobilising approximately 18.4 Mrd€ of investments

• Since the beginning of EFSI, 9.3 Mrd€, catalysing 42.3 Mrd€ of

investments in France

• Good cooperation with Secrétariat général pour l’investissement (SGI)

and promotional banks: Caisse des dépôts et consignations (CDC), Bpifrance and l’Agence française de développement (AFD).

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Implementation Status – EIB Group

EIB Loans under EFSI

EFSI allows the EIB…

• To

lend to public entities without guarantees by the responsible authority

• To increase its support to infrastructure

under Project Finance schemes with high market or construction risks (Wind parks, transport or social PPPs)

• To lend to riskier counterparts (75% of

EIB clients under EFSI in 2017 are new to EIB)

• To offer longer term loans to cover for

risky RDI investments

• To support smaller projects via riskier

intermediaries

• To be subordinated to other investors,

facilitating the crowding-in of private investors

• Financing backs:
• construction of Bus Rapid Transit System
• new 41 hybrid & 6 hydrogen buses
• a state-of-the art traffic management & control

system

• EFSI supported long-term financing ensures the

economic viability of the project EFSI Financing amount:

110 M€

EFSI related investment:

225 M€

BRT project Bulles, Pas de Calais

Clean bus rapid transit system

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EIB risk-sharing under EFSI

EFSI allows the EIB…

• To offer risk-sharing products, new to EIB,

allowing taking risks on projects financed by the intermediary, not

• n

the intermediary

• With full or partial delegation on the

analysis of the projects

• Under linked (EIB risk is on the new

projects to be financed) or de-linked structure (EIB risk is on an existing portfolio of projects, offering capital relief to the intermediary to finance new projects)

• Can be offered to NPBs or to commercial

banks

• Ensure

crowding-in through the intermediary and at final beneficiary levels

Risk-sharing French Overseas Territory

First EU/non-EU cross-border risk-sharing

• A risk-sharing framework for

Agence Française de Développement's financing of investments in the French EU & non-EU overseas departments and territories.

• Targets sectors such as urban

rehabilitation, environment, information & communication technology, tourism & sustainable transport.

• First projects: retirement home

& tourist infra in French Guyana EFSI Financing amount:

180 M€

EFSI related investment:

1.2 Mrd€

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EIB quasi-equity under EFSI

EFSI allows the EIB…

• To support new Funds, with long term

focus, or smaller Funds focusing on niche and riskier markets

• To offer bigger tickets facilitating and

accelerating the financial closing of Funds

• To

support Funds established in cooperation with regional authorities (blending with ESIF)

• To invest in Funds managed by NPBs
• To co-invest in parallel with existing

Funds

• To offer loans with quasi-equity features

(deeply subordinated debt) to support fast growing companies

Ginkgo II

Land decontamination Fund, France & Belgium

“Banks won’t give a loan to decontaminate the land, and they won’t give a loan to buy polluted land in the first place. You need equity to buy it and to carry out the project.”

Bruno Farber, Managing Director of Ginkgo Advisor

EFSI Financing amount:

30 M€

Equity

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More than just finance - investment support

Project promoters Public authorities Member States Private sector

DEMAND

• Project support throughout the

project cycle

• Support to Financial

Instruments

• Enhance access to finance

Existing advisory programmes and activities

European Investment Advisory Hub (EIAH)

• New investment support also

in areas relevant to the scope

• f EFSI (could be delivered by

EIB advisory or operational teams)

• Identification of needs as they

arise

• Network of institutions incl.

EIB Group, European Commission, National Promotional Banks etc.

• Integrated collaboration model

Additional advisory and technical assistance EIAH’s partner institutions’ expertise

SUPPLY

Web content + Web portal + Support team

Access point Delivery channels

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Thank you!

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Appendices

Financing opportunities for promoters/investors

EFSI is demand driven, and will provide support for projects everywhere in the EU. There are no geographical nor sectoral quotas. Projects will be considered based on their individual merits.

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Corporates

• f all sizes

Utilities and public sector entities (non-sovereign)

SMEs (up to 250 employees) or midcaps (up to 3 000)

Eligible counterparts

National Promotional Banks or other banks for intermediation

Dedicated Investment Platforms

Financing: EUR 100

100bn

EUR 26bn EUR 7.5bn Final investments: EUR 500bn EFSI - European Fund for Strategic Investments EUR 33.5bn

European Fund for Strategic Investments

Making a difference

Additionality – Value Added

Address market failures or sub-

• ptimal investment

situations Finance operations not possible to same extent without EFSI- backing Absorb part of the risk to trigger additional investments

Impact

Attracting other sources of finance Maximising growth Supporting employment creation and retention

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