EU investment plan to take shape next week
Nov 21, 2014 11:29 PM EST
Nov 21, 2014 11:29 PM EST
Jean-Claude Juncker will unveil a much anticipated 300-billion-euro ($370 billion) investment plan on Wednesday that is meant to trigger economic growth in the European Union.
With Europe's economy barely growing and disenchanted voters turning increasingly to anti-EU radicals, the European Commission president pledged the money in July and promised to act when he took office three weeks ago.
The European Parliament confirmed on Friday that Juncker would present the plan to it in Strasbourg at 9 a.m. but as EU officials prepared a for weekend of negotiation on both that and separate budget issues, it remained unclear how much hard cash the Union would invest.
Sources have said the plan may involve just 20-30 billion euros going to a vehicle supervised by the European Investment Bank. Intended to soak up any losses, this could attract 10 to 15 times as much in private funding for infrastructure projects.
As the European Central Bank signals a will to pump money into the economy, such a limited injection of new public cash - some of which may already have been earmarked for investment - could disappoint investors hoping for more stimulus.
But the Commission is constrained by states' finances. Those include heavyweights France and Italy, whose persistent deficits have raised a risk of penalties when their 2015 budgets are reviewed. A plan to announce the outcome of the annual review of states' budgets on Monday is likely to be put back until after a meeting of the Commission in Strasbourg on Tuesday.
Some officials warn Paris it may be fined. German commissioner Guenther Oettinger wrote in France's Les Echos daily that the EU should be tough on Paris. French Finance Minister Michel Sapin said that was "not very constructive".
Le Monde newspaper cited unidentified sources as saying that Paris would avoid penalties for now and be given some months to demonstrate greater efforts.
Also next week, Commission officials will be working on a revised 2015 budget for the European Union, after a dispute between member states and parliament sank a previous draft. Some states want to recoup funds from the EU budget to help cut their deficits - a move the European Parliament is resisting.
Adding spice to the Commission's excursion to Strasbourg, aside from a visit by Pope Francis to parliament on Tuesday, Juncker faces a censure debate there on Monday and a no-confidence vote that could dismiss his whole team on Thursday.
Called by Eurosceptics to punish Juncker, formerly Luxembourg's prime minister, for his country's role in helping firms avoid tax, the challenge has little chance of success because most other parties do not support it.
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