European commission vice-president for jobs, growth, investment and competitiveness Jyrki Katainen's faith in the EU has never faltered. "I am a passionate European. No other place on Earth and no other time in human history have provided such a remarkable degree of prosperity, social justice, security and liberty for the overwhelming majority of its people", he told MEPs at his parliamentary hearing. He went on to explain, "for me, Europe has always meant more than geography. As a student in the early 1990s, Finland’s integration into the European Union represented a new future. My country was in the middle of a deep economic crisis. The economy had shrunk by 13 per cent and youth unemployment was 34 per cent. As students, we felt sure that we would never get a proper job. We did not see an hope. We studied as long as possible, because university felt safer than being unemployed back in my home town in eastern Finland, where the situation was very bad indeed. I participated enthusiastically in the campaign to join the EU. I felt very strongly then - as I still feel today - that an integrated Europe is a source of opportunities, freedom and security."
"The reality of investment is that it is now a global phenomenon"
It is perhaps fitting, then, that he is now in charge of boosting job creation and growth in the EU. The commission's flagship strategy on this has been Juncker’s €315bn investment plan, which Katainen describes as "very much a triangle, with three key elements, designed to help the EU take a decisive step towards meeting the longterm needs of our economy and increase our competitiveness. Perhaps the most immediately visible element is the new European fund for strategic investments (EFSI). We want to see it adopted before the summer break". He proudly adds, "at the heart of this package there is a political choice. Either we continue business as usual with traditional grants and loans - and that is as far as the money goes - or we use our budget in the most efficient way - to support riskier borrowing and create a larger lending capacity. This is the choice we have made. It is a new approach at European level - to change the way public money is used". Most of the funds are expected to come from private sector investment, but Katainen says, "if member states still believe these are not enough, we invite them to make their own additional contributions."
Another key component of the plan is "the project pipeline and advisory hub - we are stepping up technical assistance at all levels and deepening our cooperation with national promotional banks. We have already identified more than 2000 projects worth €1.3 trillion". The former prime minister of Finland is quick to point out that "investment is truly a golden thread that weaves together everything that we do - we need to invest in our people, in our partnerships and in our planet". This means not only "giving people the skills they need for the 21st century economy", but also promoting "mobility inside and outside the union, in a way that supports economic growth and social cohesion, protects against external threats and contributes to international development". He adds, "we need to invest in other countries, starting with our neighbourhood where the needs are clear and pressing, both in the east and the south". Katainen understands the significance of his portfolio, commenting, "the reality of investment is that it is now a global phenomenon". Lastly, "the third element of the triangle is an improved investment environment through a deeper and wider single market with better regulation at its core."
"The fact is that, even allowing for the 'bubble' effect pre-crisis, investment in Europe is still some 15 per cent below where it should be. This is hampering both the supply and demand of our economy"
And while the commissioner works out of Brussels, he is committed to serving all of Europe's citizens, "whether they live in Athens, the Algarve or the Arctic circle". Yet he knows this won’t be an easy task, explaining, "the fact is that, even allowing for the 'bubble' effect pre-crisis, investment in Europe is still some 15 per cent below where it should be. This is hampering both the supply and demand of our economy". The Finnish official highlights that tackling Europe's challenges "will require a different way of working and indeed this commission is also set up differently, breaking down silos to ensure we build proposals in a coherent way and acting as a strategic filter to ensure we focus on what matters. I think this new way of working could have a very big impact over time".
Nevertheless, Katainen warns, "on its own, this plan is not a magic wand to transform the European economy. But, and it is a very important but, if we implement all three elements of our plan, we will change the European investment landscape permanently, and structurally, for the better."
Jyrki Katainen is European commission vice-president for jobs, growth, investment and competitiveness