Juncker unveils investment plan to kick-start EU growth

Wed Nov 26, 2014 5:51am EST
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By Jan Strupczewski

STRASBOURG, France (Reuters) - The European Commission presented a plan on Wednesday for some 300 billion euros ($375 billion) of largely private new investment in the European Union, saying it was time to kick-start growth without adding to public debt.

Underlining the need to pursue structural reforms to ailing economies and pare back debt and deficits run up during the financial crisis, the EU's new chief executive said his plan was the third leg of a strategy to get Europeans back to work.

"Europe needs a kick-start and today the Commission is applying the jump leads," Commission President Jean-Claude Juncker, a conservative former prime minister of Luxembourg who took office this month, told the European Parliament.

He acknowledged criticism that the plan lacks a major new public spending component. The EU is setting aside just 8 billion euros and the European Investmet Bank 5 billion to help provide 21 billion euros of capital for a special fund to be managed with the EIB.

The cash is to unlock 300 billion euros of investment over the next three years to create a million jobs.

The parliament's main political groups cautiously welcomed the plan, saying that while they would have liked the capital of the investment fund to be higher, it was still a good start.

But far right and left-wing deputies and the Greens criticised it, saying the leverage effect of 15 times was a fantasy and that it made risks public and profits private.

"This package is just empty words," said Dimitris Papadimoulis of the European United Left. "There is not one euro of fresh money in there."   Continued...

European Commission President Luxembourg Jean-Claude Juncker arrives to address the European Parliament to present a plan on growth, jobs and investment, in Strasbourg, November 26, 2014.   REUTERS/Vincent Kessler (FRANCE - Tags: POLITICS)