Breakfast debate : How policy impacts growing companies

On December 10, MEP Burkhard Balz, Vice-Chair of the Long-term investment and reindustrialisation Intergroup of the European Parliament, hosted a breakfast debate on how policy impacts growing companies in partnership with Invest Europe and the Invest Week, in the presence of Frédéric Mazzella, co-founder and CEO of major European success story, carpooling service, BlaBlaCar, and David Rubenstein, world-renowned investor, co-founder and co-CEO of The Carlyle Groupand, as well Members of the European Parliament, including Dominique Riquet, Chair of the intergroup, officials from the European Commission, and representatives of the industrial and the financial sector and of the civil society.

Download the Agenda

Download the list of participants

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Moderator:

Burkhard Balz MEP, Vice-Chair of the Long Term Investment Intergroup

Speakers:

David Rubenstein, co-founder and co-CEO of The Carlyle Group
Frédéric Mazzella, founder of BlaBlaCar
Dr. Bert Van Roosebeke, researcher from the Centre for European Policy

Michael Collins, CEO of Invest Europe, the association for private equity, venture capital and infrastructure investors

Alexander Schindler, President of the European Fund and Asset Management Association (EFAMA)

Niall Bohan, Head of Unit for the Capital Markets Union at the European Commission’s DG FISMA


World-renowned investor, David Rubenstein, co-founder and co-CEO of The Carlyle Group, and Frédéric Mazzella, founder of a major European success story, the carpooling service BlaBlaCar, were special guests at this debate on Europe’s approach on how policy impacts Europe’s growing companies, hosted by Invest Europe and the European Parliament’s crossparty Long-Term Investment Intergroup. They discussed the issues with MEPs, including Burkhard Balz, Commission officials, companies and academics.

  • The EU urgently needs to address its long term investment funding gap, with alternative investment such as private equity and venture capital

  • The EU is suffering from a lack of funding for infrastructure, the energy transition and the scaling-up of start-ups.

  • Getting rid of regulatory barriers is a must to attract long term investment into the EU.

MEP Burkhard Balz opened by stressing that the EU urgently needs more private investment and to leverage finance to encourage start-up development. Building on this, Invest Europe CEO Michael Collins said that the US raises five times more than the EU does in venture capital and that it is important to make things easier for long term investors by getting rid of regulatory disincentives.

David Rubenstein, co-founder and co-CEO of The Carlyle Group, said that “it would be helpful if Europe had rules that make it possible for global firms to raise capital in Europe”, citing issues with private placement in some member states. He added that it would be good for Europe if it were easier to raise capital, invest capital and deliver returns to investors. Whilst conceding that “this is not easy to do”, he concluded that if this could be achieved, Europe “would be an even more significant economy in the 21st century”.

For Frédéric Mazzella, founder of the carpooling service BlaBlaCar, “growing a company in the US is like a 100 metre race while in Europe it is like running the 110 metres hurdles race” as “you have to adapt your business to different rules – different VAT, different currencies, different languages”. “Each time it is like creating a new company. I’m in favour of a more unified regulatory environment especially for digital companies that need to reach scale fast. Adapting a product to 28 markets slows us down,” he said.

Alexander Schindler, President of the European Fund and Asset Management Association, argued that Europe urgently needs to harmonise its regulatory environment and its capital markets. He cited the different information requirements of national authorities as a difficulty to be surmounted and the importance of financial education of its citizens.

Niall Bohan, the Head of Unit for the Capital Markets Union at the European Commission’s DG FISMA, said that “funding long term investment is becoming an existential crisis”. He said Europe has an “Achilles heel” in terms of meeting the demand for capital to scale up and expand small companies, which create two thirds of jobs in the EU, and referenced the Commission’s drive to create a venture capital fund of funds to draw private capital back into Europe.

Dinner Debate : ESG criteria and the Capital Markets Union

On November 9, the Long-term investment and reindustrialisation Intergroup of the European Parliament held a dinner debate on ESG criteria in the context of the Capital Markets Union (CMU) in the presence of Members of the European Parliament (MEPs), officials from the European Commission, and representatives of the industrial and the financial sector and of the civil society.

Download the minutes

ESG dinner debate November 9

Agenda

Biographies of the speakers

Anne-Catherine Husson-Traoré, Novethic “Measuring the impact of ESG factors on investment decisions and for the green transition”

 

Lunch-debate – Energy renovation : a long-term viable investment for the EU

On October 20, the Long-term investment and reindustrialisation Intergroup of the European Parliament held a lunch-debate on the topic of energy renovation as a long-term viable investment for the EU in the presence of Members of the European Parliament (MEPs), officials from the European Commission, and representatives of the industrial and the financial sector.

Download the agenda

Download the biography of the speakers

Panama Bartholomy – “Tackling standardisation in order to stimulate EE investment

Lucas Bertalot – “Energy renovation a long-term viable investment for the EU

Jessica Stromback – “Unlocking investment for smaller energy efficiency projects.pdf

 

Press release of the partners to the Long-term investment intergroup conference Transport infrastructure pipeline: what makes a good project?

LongTermandReindustrialisationIntergroup

Transport infrastructure projects must be well prepared, with a clear socio-economic return

BRUSSELS – 13 October 2016 – In order for transport infrastructure projects to be successful in the future, a number of improvements need to occur, according to the partners taking part in the European Parliament’s long-term investment intergroup conference.

In an exchange of views at the conference which took place today and focussed on the transport infrastructure pipeline in Europe, the partners agreed that project preparation must be improved, and that the visibility of the projects should be increased via project portals.

The discussion revealed where the existing project preparation practices may be improved, in tune with the emphasis that the World Bank, IMF and MDBs placed on this topic during the annual meetings in Washington, DC last week (IISS Project Assessment Tool). Investment portals should afford a greater visibility of infrastructure projects and the investment environment should benefit from more transparent rules. Available resources should be deployed prioritizing infrastructure developments that create jobs and growth.

Dominique Riquet, President of the Intergroup, said “A good transport project should: be useful from the infrastructure point of view, provide a quality service, fundable by all the parties, generate fair revenues and improve competitiveness of the concerned area.

European Commissioner for Transport Violeta Bulc said that “the objective of the Commission’s Investment Plan is to boost project pipeline, to attract private investors, and to remove  barriers for investments. A good transportation project must generate revenues, but also demonstrate a social and economic value as well as a firm political will to contribute to decarbonisation.”

Olav Jones, deputy director general of Insurance Europe, said: “As the largest institutional investors, Europe’s insurers welcome the significant political focus placed over the past two years on infrastructure investment. In particular, the industry welcomed initiatives to increase the supply of suitable infrastructure assets, and supported work by policymakers to address regulatory barriers to infrastructure investment, such as its treatment under Solvency II. Insurance Europe hopes that these policy efforts will continue in a positive direction for the mutual benefit of all stakeholders.

Eugene Zhuchenko, Executive Director of the Long Term Infrastructure Investors Association, said “Private investors are looking for a deeper pipeline of infrastructure projects in Europe. We welcome contributions from today’s dialogue to setting better project definition standards, building sponsor’s capacity to develop new projects and implementing frameworks that crowd in more of the private capital

Marie-Laure Mazaud, Executive Director in charge of Transportation Sector & Development at Caisse des Dépôts et Consignations (CDC), pointed out that “the recent transposition of the new EU directives on public procurement and concessions in the French regulation constitutes a particularly rich and complete toolbox allowing the local authorities to fund their investment projects in optimal conditions, including PPPs. This framework offers all the guarantees and ingredients necessary to implement win-win projects for both the public and the private sectors, while financial resources have never been more abundant and attractive. CDC will support this trend and mobilize its engineering expertise to structure and finance such projects through equity investments and loans”.

Jean-Louis Marchand, FIEC President, concluded “The Investment Plan for Europe needs to reach the regions if we want it to be successful. For this purpose, the visibility of infrastructure projects at the regional scale should be strengthened. The creation of portals of regional projects, that could be part of the European investment project portal (EIPP), can be a response to these needs.

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Background information

The Intergroup is designed to support and promote the issue of long-term investment in perspective of future legislative work. Its creation followed a campaign conducted by organizations from the public and private financial spheres and contributors to the real economy. Three major national promotional banks and institutions, Cassa Depositi e Prestiti, the Group Caisse des Dépôts et Consignations and KfW Bankengruppe, have played a particularly active role. The intergroup is chaired by Dominique Riquet (ALDE-FR), Simona Bonafé (S&D-IT), Adina-Ioana Valean (PPE-RO) and Burkhard Balz (PPE-DE). Currently, the Intergroup has reached 80 members has received the support of some 50 professional federations and stakeholders.

About the partners:

FIECFIEC is the European Construction Industry Federation, representing via its 29 National Member Federations in 26 countries (23 EU & EFTA and Turkey) construction enterprises of all sizes, i.e. small and medium-sized enterprises as well as “global players”, carrying out all forms of building and civil engineering activities.

LTII logoFounded in 2014, the Long Term Infrastructure Investors Association (LTIIA) gathers investors that collectively manage in excess of 5 trillion dollars of assets and that include some of the most active investors globally in the field of long term investment in infrastructure. The Association’s three key priorities at the core of its action: (i) proactive engagement with public stakeholders to support attractive investment frameworks, (ii) development of financial performance benchmarks, and (iii) definition and sharing of best practices in relation to Environmental, Social and Governance issues. See www.ltiia.org for more information.

Insurance Europe 2Insurance Europe is the European insurance and reinsurance federation. Through its 34 member bodies — the national insurance associations — Insurance Europe represents all types of insurance and reinsurance undertakings, eg pan-European companies, monoliners, mutuals and SMEs. Insurance Europe, which is based in Brussels, represents undertakings that account for around 95% of total European premium income. Insurance makes a major contribution to Europe’s economic growth and development. European insurers generate premium income of €1 200bn, directly employ over 975 000 people and invest nearly €9 800bn in the economy.

CDC bicentenaireCaisse des Dépôts et Consignations (CDC) is designated by the French law as a long-term investor and a public group dedicated to promoting the general interest and the national economic development. With a balance sheet of €156bn, the Caisse des Dépôts Group provides in particular financial support for infrastructures projects and, through its subsidiary Bpifrance, to enterprises. CDC also manages assets on behalf of the French State, notably the savings funds for €260bn. For almost 200 years, it has never failed in its mission, whatever the economic situation, thanks to proven know-how: an excellent awareness of local issues, a capacity to construct links between the public and private sectors, to create innovative solutions which respond to collective needs. At European level, CDC is one of the core sponsors of the Marguerite Fund, which provides financing to projects in the field of energy and transport infrastructures as well as renewable energy and fight against climate change.

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Conference of the Committee of the Regions on the obstacles to investment

Open Days

As part of the European Week of Regions and Cities (Open Days), the European Committee of the Regions (CoR) will host a workshop on overcoming obstacles to investment, on October 12. Markku Markkula, President of the CoR, will discuss with representatives of the OECD, think-tanks and academia on how to boost long-term investments most conducive to innovation, productivity and growth, the local and regional authorities need fresh financial resources, to be seen as partners by their national governments and to improve their administrative capacity.

More information and online registrations on the website of the CoR

European Commission VP Dombrovskis responses positively to the request of the Long-Term Investment intergroup on infrastructure financing

On July 22, 11 MEPs from the long-term investment Intergroup wrote to Vice-President Dombrovskis to call for the Commission’s opposition to the Basel Committee proposal to increase the Risk Weighted Assets for specialized lending and infrastructure financing.

On September 21, They received an encouraging reply of VP Dombrovskis, who confirms that “the Commission is considering creating, as part of the forthcoming CRR/CRD review, a special asset class and the associated criteria for less risky bank lending to infrastructure projects which could benefit from reduced capital requirements“.

Letter from the Long-Term Investment intergroup

Response letter from Valdis Dombrovskis, Vice-President of the European Commission

Event of Bruegel on the potential impediments to long-term investment

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On 4 October, the international economic policy think tank Bruegel will organise an event on the potential impediments to long-term investment in the EU. Various factors such as accounting rules, market failures, prudential regulation and fiscal disincentives can discourage long-term investment. As stated by Grégory Claeys, Research Fellow at Bruegel, “this can be problematic because long-term potential growth of advanced economies like Europe relies mainly on productivity gains which are derived from investments in innovation, infrastructures, human capital and knowledge“. A panel discussion featuring Sophie Barbier Director for European Affairs at Caisse des Dépôts et Consignations, Miguel Gil-Tertre, member of the Cabinet of Vice-President Katainen, Sandra Rigot, Professor at Paris 13 University and Edoardo Reviglio, Cassa Depositi e Prestiti’s Chief Economist, will be followed by a Q&A with the audience chaired by Grégory Claeys.

More information and online registration on Bruegel’s website

Basel Committee project on risk calibration for banks exposure to infrastructure projects : the Intergroup writes to VP Dombrovkis

On July 22, 11 MEPs from the long-term investment Intergroup wrote to Vice-President Dombrovskis and called for the Commission’s opposition to recent draft proposals from the Basel Committee on the revision of the standardized approach for credit risk. A major concern is related to the calibration for specialized lending, including for infrastructure financing which could reach 150% in some instances. A figure to be put into perspective as the Basel Committee considers that unrated corporate exposures should be risk weighted at 100 %, even while their loss rate is generally higher than for infrastructure project finance loans.

A solution to protect the financing of infrastructure projects by banks without compromising financial stability could reside in a model in which “the eligible infrastructure assets could be restricted to projects within the EU and, outside the EU, to sectors with high recovery rates, low volatility and complying with the investment guidelines of long-term investors.

The Long-term Investment and reindustrialisation Intergroup will keep mobilizing to defend the imperative financing of infrastructures in the EU.

See the letter

June 29, lunch-debate : Ensuring long-term investments for a sustainable railway sector

On June 29, the Long-Term Investment and Reindustrialisation Intergroup held a lunch-debate in the European Parliament on long term investments in the railway sector.

This lunch-debate, sponsored by the European rail industry (UNIFE) and the Community of European Railway and Infrastructure Companies (CER), was the occasion to discuss the barriers for investment in the railway sector and the merits of the European Fund for Strategic Investment (EFSI) to address them. 

Agenda

List of the participants

Presentation of Arnaud De Monts, Alstom

Speech of Paul Mazataud, Europe Director of SNCF Réseau

Presentation of Pierre Menet, Caisse des Dépôts et Consignations