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Sudan Partnership Conference: EU mobilises more support for Sudan’s transition

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Sudan, the European Union, Germany, and the United Nations co-hosted a virtual High-Level Sudan Partnership Conference.

The Joint Communiqué adopted by the participants, confirmed the support of the international community to the democratic and economic transition in Sudan headed by the civilian-led transitional Government.

In addition to displaying strong political support to the ongoing transition, partners pledged a total of $1.8 billion (€1.6 billion), with Team Europe – which includes the EU institutions and the EU Member States – providing $867 million (€770 million) in development andhumanitarian funding. Of this amount, the European Commission is contributing €312.25 million for medium and longer-term development assistance, immediate humanitarian aid, and support to stability and peace. This contribution comes at a critical moment, as the coronavirus pandemic further exacerbates the difficult socio-economic situation in the country.

Josep Borrell, High Representative/Vice-President, said: “History is in the making in Sudan. Supporting the transition here and now is not only an expression of solidarity, but an investment worth making: for Sudan, for stability and development in the region, and in order to set an example for the world. For any transition to be sustainable, people need to see concrete and quick dividends, hence our mobilization today. The message we send to the Sudanese people is clear: we will not fail you.

Commissioner for International Partnerships, Jutta Urpilainen, said: “This conference marks the start of a renewed partnership between Sudan and the international community. Today’s EU pledge will economically empower women and youth, support social and economic development and the ambitious reforms of the civilian-led transitional Government, as well as strengthen stability and peace. Of this, €93 million will contribute to the Sudan Family Support Programme, which will allow Sudan to move ahead with critical economic reforms, laying the foundations of a social protection system. Sudan will be a priority partner for the EU for 2021 and beyond.

Commissioner for Crisis Management, Janez Lenarčič, said: “Today’s support will help vulnerable Sudanese from sliding further below the poverty line. We are stepping up our humanitarian assistance in Sudan, as the country and its people are going through a fragile transition and face major challenges, worsened by the locust outbreak and the global coronavirus pandemic. The EU continues to stand in solidarity with the most vulnerable in Sudan and our support to them is crucial in these unprecedented times.”

EU support for Sudan’s economic reforms, social protection and immediate humanitarian needs

Today’s funding pledged by the European Commission includes:

  • €251.75 million in development funding. This includes €93 million to help start Sudan’s Family Support programme, which will be managed by the World Bank. The programme will deliver social assistance and cash transfers to vulnerable households, and contribute to developing an effective and comprehensive Government-owned social protection system, while addressing the immediate economic impact of the coronavirus pandemic on the most vulnerable. It also includes €65 million to finance four new programmes that will help improve public finance management, women and youth’s economic empowerment, human rights, and the civic space. €93.75 million will further support the political transition and the most vulnerable populations.
  • €60.5 million in humanitarian funding to help provide for the critical needs of the most vulnerable people. The EU has already announced €31.5 million in humanitarian aid for Sudan in 2020. The European Commission is mobilising an additional €29 million to provide further food assistance, especially in the context of the desert locust outbreak in the region, to increase access to health care for vulnerable people, including those affected by the coronavirus and to respond to new emergencies. €20 million of this package is subject to the approval of the budgetary authority.

Around 50 stakeholders, including international financial institutions, such as the World Bank and the International Monetary Fund, participated in the conference. The World Bank committed to providing an additional pre-arrears clearance grant up to $400 million (€355 million).

The Conference was opened by a panel discussion between Abdalla Hamdok, Prime Minister of the Republic of Sudan, Josep Borrell, High Representative of the European Union for Foreign Affairs and Security Policy, Heiko Maas, Federal Minister of Foreign Affairs of Germany, and António Guterres, Secretary-General of the United Nations and. This discussion took stock of the achievements of the Sudanese political transition so far, as well as the challenges ahead. The EU pledge was delivered by Commissioner for International Partnerships, Jutta Urpilainen, and Commissioner for Crisis Management, Janez Lenarčič.

Background

Since 2016, the EU has supported the Sudanese population and the high number of refugees it hosts with development aid up to €242 million, mostly through the EU Emergency Trust Fund for Africa. These funds have been used, among others, to promote peace, support women and youth’s economic empowerment, and ensure inclusive and sustainable growth for all. Since the civilian-led Government took office in early September 2019, the EU has provided €88 million in development assistance to support political and economic reforms and contribute to stability and peace in Sudan.

Since 2011, humanitarian action in Sudan has been supported with around €580 million, including the amount pledged today. In the context of the coronavirus pandemic, two EU Humanitarian Air Bridge flights were organised to Sudan , helping humanitarian relief items and staff to reach the people in need at a time where transport constraints are posing an additional challenge. So far, it is the biggest operation of the EU Humanitarian Air Bridge in terms of the total number of humanitarian workers and cargo taken together.

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Commission invests €1 billion in innovative clean technology projects

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The Commission is launching the first call for proposals under the Innovation Fund , one of the world’s largest programmes for the demonstration of innovative low-carbon technologies, financed by revenues from the auction of emission allowances from the EU’s Emissions Trading System. The Innovation Fund will finance breakthrough technologies for renewable energy, energy-intensive industries, energy storage, and carbon capture, use and storage. It will provide a boost to the green recovery by creating local future-proof jobs, paving the way to climate neutrality and reinforcing European technological leadership on a global scale.

Executive Vice-President Frans Timmermans said: “This call for proposals comes at just the right time. The EU will invest €1 billion in promising, market-ready projects such as clean hydrogen or other low-carbon solutions for energy-intensive industries like steel, cement and chemicals. We will also support energy storage, grid solutions, and carbon capture and storage. These large-scale investments will help restart the EU economy and create a green recovery that leads us to climate neutrality in 2050.”

For the period 2020-2030, the Innovation Fund will allocate around €10 billion from the auctioning of allowances under the EU Emissions Trading System, in addition to undisbursed revenues from the Innovation Fund’s predecessor, the NER 300 programme.

The first call will provide grant funding of €1 billion to large-scale projects for clean technologies to help them overcome the risks linked to commercialisation and large-scale demonstration. This support will help new technologies to reach the market. For promising projects which are not yet ready for market, a separate budget of €8 million is set aside for project development assistance.

The call is open for projects in eligible sectors from all EU Member States, Iceland and Norway. The funds can be used in cooperation with other public funding initiatives, such as State aid or other EU funding programmes. Projects will be evaluated according to their potential to avoid greenhouse gas emission, innovation potential, financial and technical maturity, and potential for scaling up and cost efficiency. The deadline for submission of applications  is 29 October 2020. Projects can apply via the EU Funding and Tenders portal where more details on the overall procedure are available.

Background

The Innovation Fund aims to create the right financial incentives for companies and public authorities to invest now in the next generation of low-carbon technologies and give EU companies a first-mover advantage to become global technology leaders.

The Innovation Fund will be implemented by the Executive Agency for Networks and Innovation (INEA), while the European Investment Bank will provide project development assistance to promising projects that are not ready for full application.

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Member States need to do more to ensure the good functioning of the EU Single Market

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Commission is publishing the Single Market Scoreboard 2020, which shows that despite improvements in certain areas, Member States need to do more to ensure the proper functioning of the Single Market. As experienced during the coronavirus crisis, a well-functioning single market is crucial for ensuring the free movement of supplies across the EU and vital for the swift recovery of the EU economy. The results of this year’s Scoreboard, which is available as an online tool, highlight the importance of the renewed focus on implementation and enforcement outlined by the Commission’s Enforcement Action Plan adopted in March 2020. Above all, a fully functioning single market needs a partnership between the Commission and the Member States. The newly created Single Market Enforcement Task Force will be one of the key tools to foster such a collaborative approach between Commission and Member States.

The Single Market Scoreboard provides a detailed overview of how EU single market rules were applied in the European Economic Area (EEA) in 2019. It evaluates how Member States have performed as regards market openness, governance tools as well as in specific policy areas, based on a number of selected indicators. The findings are presented in the form of a “traffic light” chart, by attributing red (below average), yellow (average) and green (above average) cards.

In comparison to the previous year, this year’s Scoreboard notes a steady situation in most Member States, but observes a small decline in overall performance. In total, the Scoreboard awarded 158 green cards (153 in 2018), 107 yellow cards (137 in 2018) and 59 red cards (59 in 2018). The best performing countries in 2019 were Latvia, Cyprus, Denmark, Estonia, Finland, and Slovakia, while least improvements were observed in Spain, Italy, France and Austria.

Other key findings of the 2020 Single Market Scoreboard include:

  • Uneven enforcement of single market rules: while Member States significantly improved the transposition of EU legislation, the number of infringement procedures has grown, partly due to incompletely or incorrectly transposed EU legislation. The Scoreboard notes a particular improvement in the enforcement of consumer-related legislation, thanks to the strong coordinating role of the European Commission and the European Consumer Centres Network.
  • Expanded administrative cooperation among Member States: the use of the Internal Market Information system (IMI), which supports Member States’ administrative cooperation in 16 policy and legal areas, has increased by 52% and now covers 59 cross-border administrative procedures.
  • Steady increase in use of tools helping citizens and businesses benefit from the single market: the number of citizens using Your Europe information portal and the Your Europe Advice services has drastically increased (+48% for Your Europe with 35 million visits and +52% for Your Europe Advice with 35 thousand enquires). The caseload of SOLVIT, an informal problem-solving tool, increased by 4% overall.
  • More work needed in specific policy areas: further improvements are needed to ensure the free movement of professionals, especially to ensure more decisions recognising professional qualifications. The public procurement performance of Member States continues to be uneven, in particular as regards contracts awarded to single bidders.

Background

The Single Market Scoreboard is an online tool, which aims to monitor the performance of the Member States by using clear indicators, with the objective to improve the functioning of the Single Market. 

In particular, the annual Single Market Scoreboard evaluates how Member States:

  • implement EU rules;
  • create open and integrated markets (e.g. public procurement, trade in goods and services);
  • handle administrative issues concerning foreign workers (e.g. professional qualifications);
  • cooperate and contribute to a number of EU-wide governance tools (e.g. Your Europe portal, SOLVIT, and EURES )

The Single Market Scoreboard evaluates performance in three policy areas, two areas regarding market openness and integration, and 12 governance tools.

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Investment Plan for Europe exceeds €500 billion investment target ahead of time

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The European Commission and the European Investment Bank (EIB) Group have delivered on their pledge to mobilise €500 billion in investment under the Investment Plan for Europe. Some 1,400 operations have been approved under the European Fund for Strategic Investments (EFSI), using a budget guarantee from the European Union and own resources from the EIB Group. They are expected to trigger close to €514 billion in additional investment across EU countries and to benefit some 1.4 million small and mid-sized companies. In 2017, when the Council and the Parliament agreed to broaden the EFSI’s scope and size, the goal was to mobilise €500 billion by the end of 2020. The money was intended to address the investment gap left as a result of the 2007/8 financial and economic crisis.

Over the past years and especially after the coronavirus outbreak the focus of the EFSI shifted: it has inspired InvestEU, the Commission’s new investment programme for the years 2021-2027, and already now it contributes to the Corona Response Investment Initiative. EFSI will also play a key role in the NextGenerationEU package of measures to rebuild the European economy after the coronavirus shock. It will do this via a top-up for a Solvency Support Instrument, which aims to prevent insolvencies in European businesses.

President of the European Commission Ursula von der Leyen said: “The Investment Plan for Europe is a success. Over the past five years, it has enabled the financing of hundreds of thousands of businesses and projects, delivering on our ambitions of making Europe more green, innovative and fair. We will continue this through NextGenerationEU.”

European Investment Bank Group President Werner Hoyer said: “EFSI can serve as a blueprint for action during the coronavirus response. Knowing that we exceeded the headline figure of €500 billion of investment ahead of time is proof of the power of partnership. Implementing the financial pillar of the Commission’s Investment Plan for Europe has been an honour and a challenge for the EIB. We lived up to it not least thanks to the excellent cooperation between the Bank and European and national institutions. The success of this initiative shows what Europe can achieve with the right tools: our continent has become more social, green, innovative and competitive. We can and we should build on our experience to overcome the current crisis. It will help us to shape a Europe all of us can be proud of.”

What has the European Fund for Strategic Investments financed?

The EFSI allows the EIB Group to finance operations that are riskier than its average investments. Often, EFSI-backed projects are highly innovative, undertaken by small companies without a credit history, or they pool smaller infrastructure needs by sector and geography. Supporting such projects required the EIB Group to develop new financing products, for example venture debt with equity features or investment platforms. This changed the DNA of the Bank and revolutionised the way Europe finances its priorities.

Importantly, the EFSI also enables the EIB to approve a greater number of projects than would be possible without the EU budget guarantee’s backing, as well as to reach out to new clients: three out of four receiving EFSI backing are new to the bank. This proves the added value of EFSI operations.

Thanks to EFSI support, the EIB and its subsidiary for financing small businesses, the European Investment Fund (EIF), have provided financing for hundreds of thousands of SMEs across a wide range of sectors and in all EU countries. Examples range from sustainable agriculture in Belgium, to innovative medical technology in Spain, to an energy efficiency company in Lithuania.

Economic impact: jobs and growth

The impact of the initiative is sizable. Based on results from December 2019, the EIB’s Economics Department and the Commission’s Joint Research Centre (JRC) estimate that EFSI operations have supported around 1.4 million jobs with the figure set to rise to 1.8 million jobs by 2022 compared to the baseline scenario. In addition, calculations show that the initiative has increased EU GDP by 1.3% and it is set to increase EU GDP by 1.9% by 2022. As of the beginning of this year, 60% of the capital raised came from private resources, meaning that EFSI has also met its objective of mobilising private investment. 

Measured against the size of the economy the biggest impact is in countries that were hard hit by the 2007/8 crisis, i.e. Cyprus, Greece, Ireland, Italy, Portugal, and Spain. While the direct investment impact is particularly high in those countries, the calculations found that cohesion regions (mostly Eastern European countries) are likely to benefit more from a long-term effect. These calculations correspond with the actual financing activities under EFSI: top countries ranked by EFSI-triggered investment relative to GDP are Bulgaria, Greece, Portugal, Estonia, and Spain.

How has the Investment Plan for Europe benefited citizens?

The EIB’s EFSI report 2019 lists a number of concrete outcomes of the initiative. Thanks to the EFSI:

  • Some 20 million additional households can access high-speed broadband
  • Around 540,000 social and affordable housing units have been built or renovated
  • 22 million Europeans benefit from improved healthcare services
  • Some 400 million passenger trips/year will benefit from new or improved transport infrastructure
  • 13.4 million households were supplied with renewable energy.

Background

The Commission and the EIB Group launched the Investment Plan for Europe in November 2014 to reverse the downward trend of investment and put Europe on the path to economic recovery. Its financial pillar, the European Fund for Strategic Investments, was initially tasked to mobilise €315 billion in additional investment by 2018. Given its success, the European Parliament and Member States agreed to enhance the EFSI and extend the investment target to €500 billion by end 2020.

An independent evaluation of the EFSI published in June 2018 concluded that the EU guarantee is an efficient way of increasing the volume of riskier operations by the EIB, as it uses fewer budgetary resources compared to European grant programmes and financial instruments. It underlines that EIB support is key to EFSI beneficiaries: it provides a “stamp of approval” to the market, thus helping to facilitate future fund-raising. EFSI’s success is based not least on its efficient governance structure, which is responsive to constant changes of the markets. An independent group of experts decides if a project qualifies for backing by the EU guarantee. The goal: de-risking private investment into projects needed for a more sustainable Europe and adding value to what would have happened without public assistance.

In May 2020, the European Commission presented its revised proposal for the successor to the Investment Plan for Europe under the next Multiannual Financial Framework starting in 2021: the InvestEU Programme.

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