European fund for strategic investments

The European fund for strategic investments (EFSI) is the core of the investment plan for Europe, aimed at boosting long-term economic growth and competitiveness in the European Union.

The fund aims to help use public funding, including funding from the EU budget, to mobilise private investment for a wide range projects carried out in the EU. The projects cover areas such as infrastructure, research and innovation, education, health, information and communications technology and other areas. 

The fund is a distinct and transparent entity and a separate account managed by the European Investment Bank (EIB). It was established in July 2015 by the regulation on the European fund for strategic investments, the European investment advisory hub and the European investment project portal.

New proposal on EFSI

Since September 2016 the Council has been working on a new proposal on the European fund for strategic investments, which aims to amend the 2015 EFSI regulation.

The Council agreed on its position for negotiations with the European Parliament on the proposed regulation in December 2016. The negotiations will start after the Parliament agrees its position.

Council's position on the amended regulation: key points

The Council agreed with most of the proposed amendments and introduced a number of its own proposals.

Fund's term and financial terms

According to the Council's negotiating position:

  • the fund's term would be extended until 2020
  • the EU budget guarantee would be increased by €10 billion to the total amount of €26 billion (of which the €16 billion initial guarantee would be available until mid-2018)
  • the European Investment Bank's (EIB) contribution would be increased to €7.5 billion (from the current amount of €5 billion)
  • the fund's total investment target would be increased to €500 billion
  • the EFSI support should be easily combined, if necessary, with support from other EU funds, such as European Structural and Investment Funds and others  

Eligible projects and areas

The Council's general approach proposes extending the EFSI funding to the areas such as agriculture, forestry, fishery, aquaculture and other areas of the bioeconomy.

It also proposes ensuring that none of the projects supported by the EFSI makes use of or engages in tax avoidance structures, such as aggressive tax planning and similar schemes. 

Climate change

The Council proposes that the EFSI contributes to achieving the objectives of the EU's goals in fighting climate change. It is proposed that at least 40% of the EFSI funds allocated to the combined objectives in the areas infrastructure and innovation be contributed to climate action. The Council proposes that this computation should not include the share of the fund dedicated to small and medium-sized and mid-cap companies.

Addressing market failures and identifying investment bottlenecks 

The fund would be strengthened to support those projects that clearly help to address identified market failures or sub-optimal investment situations.

The Council also proposes that the EIB share the findings it has made, through EFSI operations, on barriers to investment with the European Commission. The Council invites the Commission to use this information in its work to improve the regulatory environment in order to boost investment (under the 'third pillar' of the investment plan for Europe). 

Next report on fund's performance

The Council proposes that the European Commission evaluate the performance of the fund, the use of the EU guarantee as well as the functioning of the EIAH and submit reports to the Council. 

The Council proposes that the first report be submitted by 30 June 2018 and the second by 31 December 2019. The latter should be the basis for the further decision to either extend or terminate the fund's activities after 2020.


The Council agrees that the decisions to grant EFSI support to projects, and the reasons for those decisions, should be made accessible to the public. The Council proposes that these decisions be published following approval of the EFSI operations by the EIB board of directors.

In the Council

15 December 2016: the European Council welcomed the agreement reached in the Council on the extension of the EFSI. 

6 December 2016: the Council agreed its negotiating position on the proposal to extend the EFSI.

20-21 October 2016: the European Council called on the Council to agree on its negotiating position on the new EFSI proposal in December 2016, taking into account the independent external evaluation that was expected in November 2016.

September 2016: the Council started working on the new proposal to amend the 2015 EFSI regulation in order to extend the fund's activities and introduce technical changes to the European investment advisory hub.

25 June 2015: the Council adopted the EFSI regulation, following its approval by the European Parliament on 24 June 2015. The regulation entered into force at the beginning of July 2015.

28 May 2015: the Council and the European Parliament reached a provisional agreement on the draft regulation.

23 April 2015: the Council and the European Parliament started negotiations on the final version of the EFSI regulation. 

10 March 2015: the Council adopted its negotiating position on the draft regulation (the Council general approach).

European fund for strategic investments

Key aims of the European fund for strategic investments:

  • to provide enhanced risk-bearing capacity to the EIB's investment operations
  • to address market gaps and situations where investment activity is too low
  • to help generate around €315 billion of additional investment in three years


The main function of the EFSI is to take on some of the risks associated with the activities carried out by the European Investment Bank (EIB) and the European investment fund.

The enhanced risk-bearing capacity that the EFSI provides to the EIB allows the EIB to invest in projects with a higher risk profile than usual. EIB investment with the backing of the EU guarantee is expected to attract private investment.

It is estimated that the fund, which totals €21 billion,  will achieve an overall multiplier effect of 1:15, and thus generate around €315 billion in new investments.

This means that the €21 billion fund allows the EIB to borrow about three times as much, i.e. around €63 billion, for investment and financing of projects.

The €63 billion that will be available for investments is in turn expected to attract investment from private investors, which should be worth a total of around €315 billion.

The estimate on the multiplier is based on the EIB's and the European Commission's experience from similar projects in the past.


The EFSI is a distinct and transparent entity and a separate managed account at the EIB. It complements the usual investment activities of the EIB.

The EFSI is built on:  

  • a €16 billion guarantee from the EU budget (€8 billion earmarked in the EU budget to support a guarantee of €16 billion)
  • €5 billion from the European Investment Bank


The European fund for strategic investments has two levels of governance:

  • a steering board
  • an investment committee

The managing director is responsible for the day-to-day management of the EFSI and for chairing investment committee meetings. The managing director reports regularly to the steering board.

The candidate for the managing director's post is selected by the steering board. The selection is to be approved by the European Parliament following a hearing.

Steering board 

The steering board comprises four members: three appointed by the European Commission and one by the EIB. The EFSI steering board decides on:

  • the overall strategy of the EFSI
  • the risk profile of the EFSI
  • the operating policies and procedures of the EFSI
  • rules applicable to the investment platforms and national promotion banks

The board takes decisions by consensus.

Investment committee 

The investment committee examines projects and decides which of them are eligible to benefit from the EU guarantee. It is accountable to the steering board.

The committee is made up of 8 independent market experts and a managing director. The experts are appointed by the steering board, following an open and transparent selection procedure, for a period of up to three years, which can be renewed once.

The EFSI is organised in a way that ensures the investment committee's operational independence.

The committee takes decisions by simple majority.

Projects to be financed

The EFSI  focuses on projects in a wide range of areas, including:

  • development of infrastructure
  • research and development and innovation  
  • investment in education and training, health, information and communications technology
  • development of the energy sector

Around one quarter of the fund is dedicated to projects supporting small and medium-sized enterprises (SMEs) as well as mid-cap companies. A mid-cap company is a company that has up to 3000 employees, and is not an SME.

The EFSI is not providing grants or subsidies.

Project selection criteria

Eligible projects must:

  • be economically and technically viable
  • support EU objectives
  • have the potential to leverage other sources of funding  
  • be projects that require support from the EFSI and cannot be implemented through existing EU and EIB instruments alone

The projects can be implemented anywhere in the EU and in any of the eligible sectors: there are no geographical or sectoral quotas.  It will be ensured that the EIB does not take on excessive exposure in a particular sector or location.

Investment guidelines

The investment guidelines, laid down in the annex to the EFSI regulation, establish more detailed project selection criteria.

The guidelines are used by the investment committee to take decisions on the use of the EU guarantee for projects.

The guidelines can be amended by delegated acts.


According to the EFSI regulation, the EU provides a €16 billion guarantee to support investment and financing operations by the EIB. For this purpose an €8 billion guarantee fund will be established to protect the EU budget against potential losses that might be incurred by EFSI activities.

The guarantee fund will be built gradually from the EU general budget towards a target level of €8 billion. This will make up 50% of the total guarantee that will be provided by the EU under the EFSI regulation.

The guarantee is financed by reallocating the following funds:

  • €2.8 billion from the Connecting Europe Facility
  • €2.2 billion from Horizon 2020
  • €3 billion from the unused budget margin

Lifetime of the fund

According to the regulation establishing the fund, the European Commission is to evaluate the functioning of the EFSI and whether it has achieved the objectives of the regulation. Depending on the outcome of the evaluation, the Commission may propose that the activities of the fund be extended.

Following the evaluation that was carried out at the beginning of 2016, the European Commission proposed to amend the EFSI regulation in order to extend the EFSI's activities until 31 December 2020.

Stability and Growth Pact rules and investment

The European Commission proposes that the contributions by the member states to the EFSI not be taken into account under either the preventive or the corrective rules of the Stability and Growth Pact.

Who can participate in the activities promoted by the EFSI?

EU member states

EU member states are able to contribute to the EFSI in guarantees or in cash.

They are able to participate via 'investment platforms', which will be set up to support groups of projects. The member states are also able to contribute to the financing of specific projects.

In addition, the member states can also contribute through their national promotional banks, which are public institutions that carry out financial activities to support public development in the member states.

Other investors

Other investors, from both the public and private sectors, can contribute to a project or to investment platforms. Contributing to the EFSI does not grant any right to influence the fund's governance.

Next steps

The Council will begin negotiations on the draft amended EFSI regulation with the European Parliament once the latter has adopted its negotiating position.