On the eve of the EU's Spring Summit, President José Manuel
Barroso prepared the ground for political agreement on 'project
bonds'. For the time being, the bond will be solely used for
projects in energy and IT, but when this pilot project
succeeds, the concept of a 'project bond' might also expand to
other areas, for example the area of research and innovation.
Two types of bonds
"You have to remember that it is extremely difficult to gather
member states around the concept of a common bond", Barroso
confided to ScienceGuide after his keynote speech at the
Europe 2020 summit of the The Lisbon Council in Brussels. "You
must not confuse these pilot project bonds with the so-called
Eurobonds, that aim at the mutualization of government debt."
In his talk with ScienceGuide, Barroso stressed the
practical and concrete nature of the impulse for knowledge
and innovation he envisages. The European Commission explores the
idea of 'project bond' in order to establish debt capital markets
as an additional source of financing for infrastructure projects
and at the same time stimulate investment in key strategic EU
infrastructures in transport, energy and broadband.
"What we are talking about here are concrete bonds for concrete
projects, for interconnecting networks for example." The idea is
that using this method, an upfront investment of €230 million in
European funding through specific programmes - like the
Competitiveness and Innovation Programme (CIP) - will be able to
mobilize private investments up to €4.6 billion.
No fiscal space
President Barroso stressed that austerity measures must
always be coupled with growth enhancing measures. "We speak about
'growth and creating jobs', but where will the growth come from? We
will need some kind of investment and since there is no
fiscal space in the member states, we need European investments to
boost growth."
And the 'project bond' can become a multiplier of those European
investments. Does President Barroso see room for institutions of
research and higher education in this regard? "Of course they can
become a partner in such projects. Think of activities in the
field of energy and transport. We would very much welcome
that!"