Katainen: Juncker plan to create 1.3 million jobs

The European Commission calculates that the Juncker Plan for a European Strategic Investments Fund will create 1.3 million jobs, said Commissioner for Growth and Jobs Jyrki Katainen in a debate with Economic and Monetary Affairs Committee MEPs.

MEPs raised concerns about the risks associated with the fund, which is expected to trigger €315bn in investments, its possible impact on the EU budget and the selection of the projects.

Katainen defended the Commission’s “high risk approach”, arguing that there is sufficient liquidity in the market, but a shortage of investment in the private sector. “Without a ‘first loss scheme’ the fund would not take off,” he underlined.

Investment shortfalls are caused by a lack of both supply and demand, Katainen said, adding that “some member states are just not sufficiently competitive”. But some member states have also chosen to cut public spending, which has had a negative impact on EU-wide investments. “In an ideal world, investments would be €300bn higher than they are now”.

The selection of projects will be “non-political”, Katainen said. “The Investment Committee will make the selection in an independent manner, after which the Governing Council of the European Investment Bank will give its signature. But at that stage, there is no room for political influencing.”

Replying to MEPs’ concerns about proposed “favourable treatment” within Stability and Growth Pact limits of national investments through the fund, he said countries with a deficit above 3% of GDP could win leeway if their governments have decided on necessary structural reforms.