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European Financial Services Round Table

Wednesday, October 22, 2014
EFR Strategic paper: Facilitating European Infrastructure Investment
New EFR Strategic paper: Facilitating European Infrastructure Investment The global economy benefits from infrastructure investment as a driver of growth. Europe requires infrastructure investments of between EUR 1.5 trillion to EUR 2.0 trillion to meet the policy goals of its Europe 2020 strategy. However, there is a substantial funding challenge as traditional lenders are under pressure from various sides to deleverage and reduce their balance sheets. While national governments need to increase their investment, private investment and particularly long-term institutional investors could play a further role. The European Financial Services Round Table (EFR) supports the further investment in European infrastructure and has launched a new initiative to help infrastructure become a more accessible asset class for institutional sources of capital in Europe. The EFR strategic paper below - "Facilitating European Infrastructure Investment" - explains that to increase accessibility, particularly for institutional investors, there needs to be greater transparency and harmonization of project pipelines, structures, financing and performance. There also needs to be further availability of best practices and benchmarking / performance data to increase the supply of projects and public and private investor confidence in the sector. In order to maximize market participation, reduce inefficiency, and accelerate the development of infrastructure as an asset class, the EFR argues that Europe needs to develop a more standardized and harmonized infrastructure capital market. By creating a common framework for project due diligence and disclosure, or pan-regional passport, infrastructure investing will become more accessible for long-term institutional investors. Such a standardized framework should maintain flexibility, to enable different jurisdictions to impose additional requirements where necessary.