Juncker’s investment offensive risks turning against Europeans

Brussels – Environmental NGOs call on President Juncker, the European Commission and the European Investment Bank to consider for financing from the 315 billion growth package only projects which are sustainable and in line with EU goals and only after proper public consultation with potentially affected communities.

“The idea of an investment offensive to stimulate the real economy in Europe is potentially good, but seeing what projects member states want prioritised for financing raised alarm bells,” comments Markus Trilling from CEE Bankwatch Network. “Offering public guarantees for highly risky projects such as mega-coal units, nuclear plants or incinerators is no way to ensure the sustainable development of European economies. On the contrary, it’s making Europeans pay for projects which contradict EU goals such as fighting climate change. It’s an offensive against Europeans.”

“There is a huge pipeline of energy efficiency, renewable energy and more green projects in Europe that should be the focus of this investment package: they are the best placed to deliver more and better jobs, a safer and more stable energy market, and a healthier environment. President Juncker should not miss the opportunity to invest public money where it most benefits the people and their future”, said Sébastien Godinot, Economist at WWF European Policy Office.

Ahead of the European Council December 18-19, during which the approval of member states will be sought for the investment package, six major European environmental NGOs sent a letter to the European Commission and the European Investment Bank asking the institutions to pay heed to five recommendations concerning the selection of projects:

1. that full transparency is ensured during the process of selection of projects and that meaningful public consultations are conducted before financing is agreed,
2. that projects selected are fully in line with the EU 2050 climate and biodiversity goals,
3. that projects financed contribute to energy and resource efficiency and to the decarbonisation of energy and transport systems in line with the climate imperative, which would come with important economic gains,
4. that money is benefiting local communities instead of being wasted on carbon and resource intensive large scale projects [*],
5. that financial instruments are used wisely making sure that investment risks are not socialised while profits privatized.

An example of how such smart spending from the growth package could look like can be found in Anne Valley, Ireland, where an integrated wetland was constructed instead of installing a traditional water treatment plant. Not only is the wetland more efficient in clearing mostly livestock wastewater than a traditional plant, it also offers multiple benefits like flood control and climate regulation. Capital costs were €715,000 for the project – less than half the estimated cost of an equivalent traditional plant (€1,530,000). Annual maintenance costs are also lower. In addition €220,000 was spent on new tourism facilities which are creating additional economic value, impossible with a traditional plant.

Xavier Sol from Counter Balance says: “If this growth package is to be anything more than smoke in the eyes of Europeans, then the Commission and the European Investment Bank must exercise political will and ensure that only those projects which can indeed contribute to the sustainability and resilience of the European economy are selected and financed.”

Notes for the editors:

*A special report from the European Court of Auditors recently criticised the spending of EU and EIB funds on unnecessary “white elephant” airport projects: http://www.eca.europa.eu/Lists/ECADocuments/SR14_21/SR14_21_EN.pdf
Airports are among the proiects proposed by member states for financing from the investment package.

CEE Bankwatch Network is publishing every day a profile of one of the projects proposed for financing by member states:
https://bankwatch.org/news-media/blog/juncker-investment-offensive-against-europeans-economy-and-environment

Read the letter sent by NGOs to the EC and the EIB:
https://bankwatch.org/sites/default/files/letter-EC-EIB-EFSI-16Dec14.pdf

See an infographic about how countries in Central and Eastern Europe plan to use EU Budget money for problematic spending, including fossil fuels and incinerators, an omen for how the Juncker money could be spent in the region:
https://bankwatch.org/newmoneyoldideas

For more information, contact:

Markus Trilling
EU campaigner, Bankwatch
Markus.trilling@bankwatch.org
+ 32 484 056 636

Sebastian Godinot
Economist
WWF European Policy Office
sgodinot@wwf.eu
+32 2 740 0920

Xavier Sol
Director
Counter Balance
xavier.sol@bankwatch.org
+32473223893