MEPs remain wary of Juncker investment plan

The European commission announcement that its investment plan will create '1.3 million jobs' has failed to impress MEPs.

By Julie Levy-Abegnoli

03 Feb 2015

Commissioner for growth and jobs Jyrki Katainen participated in a debate with parliament's economic and monetary affairs committee, and told MEPs that president Jean-Claude Juncker's investment plan - expected to rake in €315bn worth of investments - will lead to the creation of "1.3 million jobs".

While a majority of MEPs have expressed their support for the commission's investment plan, others have been more cautious, with Dimitrios Papadimoulis, who is a vice-president of the European parliament and a member of the GUE/NGL group, describing it as "business as usual".

Meanwhile, ALDE group president Guy Verhofstadt has urged member states to implement structural reforms before the investment plan can be set in motion.

And while commissioner Katainen's announcement sounds like good news - the current EU unemployment rate stands at 10 per cent - he failed to specify how these jobs will materialise. 

"With careful consideration of the employment dimensions, the impact [of Juncker's investment plan] would be up to 2.1 million new jobs by 2018" - Raymond Torres

The investment plan itself is fairly vague, with member states expected to contribute to a 'European strategic investments fund' in order to - hopefully - attract money from private investors.

Now, MEPs have complained that the fund has so far failed to collect much financial support from member states. Maria João Rodrigues, the S&D group's vice-president for economic and monetary affairs, said, "Europe needs a massive dose of investment for the real economy - not just words".

She called for "capital pledges before the informal European council" next month.

Eider Gardiazábal, who is the Socialists' negotiator on the investment plan for parliament's budget committee, stressed that "we need this plan to start working quickly in order to reactivate the economy and bring back the welfare that austerity has destroyed".

ALDE vice-president Pavel Telička commented that "Europe will only regain its competitiveness if member states show more commitment to cut red tape, to reform and to create an environment that is attractive to innovative companies".

He added, "We don't need council meetings, we need concrete national plans".

GUE/NGL group member Liadh Ni Ríada was very critical following Katainen's appearance in parliament, saying the commission's proposal "will create nothing more than a financial bubble and a false economy".

Speaking to parliament's employment and social affairs committee, Raymond Torres, director of the international institute for labour studies - which is part of the international labour organisation (ILO) - warned that "if investment projects are not selected properly, simply there will be investment involved in the plan that would have happened even in its absence".

If this was the case, the ILO estimates that only 400,000 jobs will be created - much less than the 1.3 million jobs promised by the commission.

However, Torres added that if investment projects are selected "with careful consideration of the employment dimensions, the impact would be up to 2.1 million new jobs by 2018".

With three different figures floating around about the actual effect Juncker's investment plan will have on employment, perhaps it is safe to say that only time will tell how useful it will be to boosting the EU economy.

 

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