EU leaders meeting in Brussels have agreed to support an investment fund that aimed to attract €315 billion in private money and kickstart growth in the bloc, Channel New Asia reported.
The announcement came at the annual summit in Brussels, which also coincided with newly approved EU sanctions against the Crimea peninsula annexed by Russia - part of western efforts to force Moscow to end support the separatists in East Ukraine.
The EU's new investment plan met with little resistance and aimed to gather an initial fund of €12 billion to attract €315 billion in private investment toward infrastructure projects over the next two years.
The scheme set for launch in June is expected to kickstart growth in Europe's economy without adding to public debt. However, member states have not come forward with contributions.
According to EU Council president Donald Tusk, geographical interests were not discussed. It was for private investors to back the most interesting projects.
Relations with Moscow over the crisis in Ukraine also figured on the agenda as EU officials finalised a fresh list of sanctions against the Russian annexed peninsula of Crimea, and warned that Russia still had not done enough to end separatist fighting in East Ukraine.
The aim was to generate €315 billion over three years for investment in EU infrastructure projects, The Irish Times reported. The highly leveraged European Fund for Strategic Investment would use €21 billion in European seed capital - provided by the Commission and the European Investment Bank - to attract around €300 billion in private finance. Member states could provide top-ups, without affecting their EU deficit and debt calculations.
A feature of the economic downturn had been the failure to produce sooner a plan to boost economic activity and for too long too much reliance had been placed on the European Central Bank to provide a monetary stimulus to boost growth. The restrained monetary easing of the bank has had limited effect and the euro zone still remained at risk of a possible third recession. The euro zone economy was marked by low growth, and high unemployment, and deflation rather than inflation the greater hazard. As against this, Ireland remained Europe's fastest growing economy, with unemployment - at 10.7 per cent - below the euro area average.
In an unexpected announcement on the eve of the EC meeting, the commission requested all 28 EU member states to supply information on tax rulings. To date only six countries have been asked to do so, of which three, including Ireland, were under investigation by the commission for a breach of state aid rules.