2024-03-19 08:01:21
Will the European Investment Bank (EIB) be the financial arm of Europe’s rearmament? This is the wish expressed by fourteen European countries. A new course in perspective for this institution at the heart of all the strategic changes in the European Union.
The France and theGermanyl’Italythe Poland, along with other countries in the north and east of the European Union (EU), have written to the new EIB president, Nadia Calvino of Spain, to request that the Bank finance the effort more broadly. defense, reports Agence France-Presse. A small revolution.
Until today, its support in this area has been limited to both civil and military applications, provided that the civilian benefits are the majority. It is this clause that the Member States first wish to lift. A fund dedicated to these dual applications was launched in 2022, to facilitate, among other things, the design of drones.
The EIB’s political and financial reserves
The EIB has long refrained from financing further rearmament for political reasons. Until the Russian war againstUkrainethe most powerful country in the EU, Germany, was an unyielding supporter of pacifism and until December it was a German, Werner Hoyer, who headed the EIB.
But it was also for financial reasons that she avoided venturing onto the battlefields. She fears losing her precious triple AAA, which allows her to raise capital at the best price. But the new threats hovering over Europe – Russia on its doorstep, the NATO umbrella shaken by Donald Trump – will undoubtedly force it to change gear.
The European Investment Bank had become Europe’s green bank. 60% of the loans it grants are now used to finance the energy transition. At the time of its creation, it mainly financed infrastructure work in the poorest regions. From 2019, it will transform into a climate bank. When Covid arises, it becomes the largest provider of funds for the recovery plan. Tomorrow, it will perhaps be guns that it will finance. It will remain green, but with a khaki undertone.
Windfall for overly indebted states
Many member states are already deeply in debt, so they are turning to the body created to advance them money safely to finance their new priorities. The EIB, little known to the general public, is very well known in the world of finance. The largest multilateral bank in the world is capable of attracting private investors, reassured by its financial solidity.
Constantly changing, it has become central in the European Union. Witness the fierce battle to win the presidency. Espagnole Nadia Calvino, former Minister of Finance, won by promising to do more for defense. And for nuclear power: yet another new field to clear. This does not mean either that the bank will advance capital with its eyes closed for cannons or EPRs [réacteurs nucléaires]. It remains a bank, keen to limit its risks.
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