By Magreth Nunuhe
WINDHOEK–THE European Commission has tabled an ambitious plan to stimulate African economies as a means of countering rapid migration to Europe.
EU Ambassador to Namibia, Jana Hybaskova, on Monday announced the EU’s External Investment Plan to support investment in its partner countries in Africa and poor parts of Europe. The fund will be capitalised with 3.35 billion Euro from the EU budget and the European Development Fund.
The plan appears to be the EU’s proactive measure to address the migration crisis, which has seen many North Africans drown while trying to cross into Europe in search for a better life. Most of those who flee Africa leave behind countries offering no hope and poverty. EU states, especially those in southern Europe, are mostly affected because of their proximity to North Africa.
The EU’s External Investment Plan is envisaged to boost investment and in particular support social and economic infrastructure and SMEs by addressing obstacles to private investment.
The plan will further mobilise up to 44 billion Euro of investments to strengthen its partnership and promote a new model of participation of the private sector to achieve the United Nations Sustainable Development Goals (SDGs).
“If member states and other partners match the EU’s contribution, the total amount could reach 88 billion Euro. By unlocking investments in partner countries, the External Investment Plan will contribute to implementing the 2030 Agenda on Sustainable Development Goals and the Addis Agenda on Financing for Development,” said Hybaskova.
The investment plan provides, for the first time, a coherent framework to improve investment in Africa and the European neighbourhood, in order to promote sustainable investment and tackle some of the root causes of migration. By addressing the causes of migration, the EU could be hoping to tame the number of Africans and Europeans fleeing to the Eurozone.
The plan will also offer a guarantee to the private sector to invest in countries that are politically more risky.
“Investments will mainly be targeted to improve social and economic infrastructure, for example, municipal infrastructure and proximity services, and on providing support to SMEs, microfinance and job creation projects,” the European Commission noted.
The public and private sectors are eligible to receive support through the External Investment Plan and can submit investment proposals under the investment subject to the relevant financial assessments being carried out by external, independent experts for the Commission.
To qualify, applicants must be able to contribute to economic and social development, with a focus on job creation among youths and women.
Applicants should also have plans to develop energy, water, transport, ICT, environment, social infrastructure, human capital and finance, with a bias for micro, small and medium-sized enterprises.
The Commission will also expand the EU budget guarantee under the European Investment Bank’s External Lending Mandate by a total of 5.3 billion Euro, which would make it possible to lend up to 32.3 billion Euro under the EU guarantee between 2014 and 2020.
According to Hybaskova, the funding that the EU will provide under the External Investment Plan is not a traditional grant aid, but a blending mechanism to mobilise additional support in the form of loans.