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  • Barroso for smart growth

    - ‘Eurobonds’ make European leaders nervous, their little brother – the ‘project bonds’ – could come soon to serve as an impulse for investment in R&D and innovation. Commission President Barroso is a great supporter of them. “We speak about 'growth and creating jobs', but where will the growth come from?”

    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!"