Publication
EIB Investment Report 2023/2024
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What is it about?
European companies have shown resilience by maintaining strong investment spending despite facing crises like the COVID-19 pandemic, energy crisis, and geopolitical tensions. Government support has played a crucial role in preventing the worst-case scenarios, and firms are adapting by investing in energy efficiency to mitigate the impact of rising energy prices.
The analysis delves into the dynamics of corporate investment during these turbulent times, highlighting the impact of rising prices, and the effects of governments tightening monetary policy, making it harder for companies to borrow money. It emphasizes the uncertainty surrounding the future of investments, balancing the potential for resilience driven by structural transformation against looming threats like rising interest rates and potential structural bottlenecks.
Why is it important?
Policy makers, businesses and investors all need to understand the detail of European corporate investment during a period of economic turbulence. By continuing to invest, companies can drive innovation, create new products and services, and remain competitive in the global market. Additionally, investments in energy efficiency can lead to cost savings, reduced environmental impact, and increased competitiveness in a rapidly changing business landscape. But there is a delicate balance to be struck by companies using funding reserves at a time when it is harder to borrow money.
Government policies that support investment not only help companies to navigate crises, but also contribute to long-term resilience and sustainability of the overall economy. Overall, the resilience of corporate investment in Europe reflects the adaptability and determination of businesses to overcome obstacles and thrive in uncertain times.
Perspectives
The digital and green transitions, combined with the growing roll-back of globalisation, are pushing the European economy to transform to be more sustainable, resilient, productive, and competitive. Now is the time to accelerate efforts to achieve those aims.
Debora
Revotella
European Investment Bank
