New financial instruments have been created within the context of cohesion policy and enhanced cooperation between the European Commission and the European Investment Bank Group and other International Financial Institutions.
The Commission has highlighted the need to enhance support for start-ups and micro-enterprises, through technical assistance, grants, as well as non-grant instruments such as loans, equity, venture capital or guarantees, and highlights the added value of undertaking these actions in cooperation with the EIB group. Evaluations and studies demonstrate a clear correlation between, on the one hand, access to finance and risk capital for small and medium enterprises and, on the other hand, economic growth and competitiveness.
Likewise, the Communication “Cohesion Policy and cities: the urban contribution to growth and jobs in the regions” notes that there is no single path to sustainable urban development. Actions can take various forms depending on the particular characteristics and needs of urban areas. Suggested interventions include building the attractiveness of cities, increasing networking between cities, reinforcing the role of cities as poles of growth, promoting entrepreneurship, innovation and the knowledge economy, supporting SMEs decreasing disparities between neighbourhoods and social groups, and tackling crime and the fear of crime.
New financial engineering initiatives, such as JEREMIE and JESSICA, create strong incentives for successful implementation by beneficiaries by combining grants with loans, ensuring long-term sustainability through the revolving character of the European Regional Development Fund’s (ERDF) contribution to financial engineering actions.
These financial instruments are providing additional loan resources for business formation and development in the regions of the EU. Additionally, they contributing financial and managerial expertise from specialist institutions such as the EIB Group and other International Financial Institutions.
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