EU Eyes Private Investment for Green Transition

The European Union intends to leverage private investments for its green and digital transition, emphasizing public funds should only serve as a catalyst. The move aims to ensure competitiveness with the U.S. and China. The EU faces challenges from limited public finances, necessitating private sector involvement.

The European Union (EU) is seeking to leverage private investments as the primary source of funding for its ambitious green and digital transition. EU finance ministers, in a statement expected on Monday, emphasize that public funds should act only as a catalyst to draw in private capital.

The statement, seen by Reuters, highlights the EU's efforts to remain competitive with giants like the United States and China in new technologies, while also aiming to cut CO2 emissions. Former European Central Bank President Mario Draghi noted that the EU needs approximately 800 billion euros ($868.48 billion) annually in investments to keep pace economically.

Addressing challenges in public finances due to past crises, the ministers plan to discuss this approach ahead of an EU summit on competitiveness. They stress the importance of developing capital markets to facilitate private investment, while ensuring that EU taxpayer funds are used to finance public goods where joint European financing can optimize delivery.

(With inputs from agencies.)