(Bloomberg) -- The European Investment Bank is set to pledge €500 million in counter-guarantees to clean-tech companies to help them compete with global rivals.
The EIB plans to unlock the money in tranches of up to €30 million ($31.6 million) from next year, should the board approve the program by early 2025, according to Jean-Christophe Laloux, head of operations at the Luxembourg-based institution.
The move highlights the bank’s efforts to double down on support to the region’s clean-tech firms, with rivals in the US benefiting from the country’s Inflation Reduction Act and China providing state support to its companies. Last year, the EIB unveiled a €5 billion pledge of counter-guarantees to boost Europe’s struggling wind sector, with half the amount committed this year, Laloux said.
“This notion of us in Europe having to focus on scaling up is now really, really important,” Laloux said in an interview during the COP29 climate summit in Azerbaijan. “There’s a real issue for us Europeans to keep our talent at scaling-up stage.”
Former European Central Bank President Mario Draghi highlighted in a report earlier this year the pressing need for Europe’s companies to scale up so they could compete with foreign peers. The report highlighted such counter-guarantees as a key tool.
The EIB’s program will help new and smaller companies that are often required by banks to have extra capital in order to secure financing guarantees. Around 15 clean-tech companies, such as those that provide industrial heat, are set to benefit, Laloux said.
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