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The European Commission and the European Investment Bank (EIB) have unveiled a €5 billion flexible guarantee designed to unlock up to €10 billion in investments in clean energy, infrastructure, and small and medium-sized enterprise (SME) financing across key global regions.
Announced at the 4th International Conference on Financing for Development, the initiative marks a significant expansion of EU-backed external investment tools, aligning with the EU’s Global Gateway strategy. The guarantee will support high-impact projects in North Africa, the Middle East, the Eastern Neighbourhood, Central Asia, and Latin America.
Key Features and Innovations
Unlike previous guarantee instruments, which were largely restricted to state-backed projects, the new agreement allows for support to non-sovereign entities—such as private companies and municipalities that finance themselves through the capital markets. This added flexibility is expected to accelerate investment deployment and broaden the impact of EU development finance.
“With today’s new type of guarantee agreement, it will be more flexible and faster to back up investments,” stated a joint release from the Commission and EIB.
The guarantee is intended to make financing available for projects that may otherwise be considered too risky by traditional lenders, while maintaining affordable borrowing terms for partner countries.
Strategic Objectives
The new mechanism will:
- Support clean energy and green infrastructure projects
- Expand access to finance for SMEs in partner countries
- Enable development of telecommunications and energy networks
- Strengthen local economies in EU enlargement and neighbourhood regions
- Advance EU-backed global initiatives such as the Trans-Caspian Corridor and sustainable raw material supply chains
It will also help deliver on Global Gateway objectives, with investments targeted toward improving connectivity, sustainability, and economic resilience in emerging markets.
By combining financial risk-sharing with strategic geopolitical outreach, the EU and EIB aim to position the guarantee as a catalyst for sustainable development, economic opportunity, and climate resilience in regions critical to European and global stability.
EIB European Investment Bank Hq Picture from positivemoney.org
