By V. Kostoulas
European Investment Bank (EIB) officials this week referred to the size and scope of proposals for prospective inclusion in its investment schemes, especially the so-called Juncker stimulus plan, as the sole problem when dealing with Greece.
"Size and scope" in this case refers to the fact that most proposals from Greece are smaller, in value, compared to other EU countries.
The observation, of course, has both reassuring and disquieting elements, given that the still bailout-dependent country has few options left - ahead of the looming end of the third bailout program in August 2018 - but to attract major investments from all and any sources. The goal is immediate and robust economic growth to lower unemployment, jumpstart consumption and increase tax revenue from increased commerce.
The primary characteristic of the European Fund for Strategic Investments (EFSI), as the strategic Juncker plan is officially called, is its emphasis on investment schemes that entail a business risk - eschewing any scent of "rent seeking" that critics often ascribed to past EU stimulus programs - or ones entailing a high degree of innovation. The latter's emphasis is an attempt by the Commission to cover a "gap" in financing towards innovation-based business models that traditional lenders often skip.
Another positive exception in the EFSI plan, at least as far as recession-battered Greece is concerned, is a lack of a specific percentage cap in terms of financing that can be funneled to the country. The favorable condition is ostensibly related to the length and intensity of the economic implosion in Greece since 2010.
Based on still unofficial estimates so far, EIB financing towards Greece in 2017 will hover at around two billion euros, meaning that the country will be among the first six member-states in absolute figures for financing, behind Italy, France, Spain, Germany and (somewhat surprisingly), the UK. Greece is expected to surpass Poland in terms of EIB funding.