Long-term Financing of the European Economy (Communication)
The EU Commission wants to increase the supply of possibilities for long-term financing, particularly for small and medium-sized enterprises (SMEs) and infrastructure projects.
The diversification of long-term funding may stimulate the availability of loans as long as the risks are sufficiently taken into consideration. However, the Commission ignores the demand-side causes of the lack of long-term investment which will continue without structural reforms to increase competitiveness. An EU-label for "high-quality securitisations" may rebuild confidence in the securities market. The proposals for encouraging more future investment by insurance companies in infrastructure projects and SME loans, are risky. A government funded "EU savings account" should be avoided. It may lead to less rather than more investment.