BRUSSELS, March 23 (Reuters) – A future European Sovereignty Fund could finance joint European Union projects to keep the 27-nation bloc ahead of global competition in clean technologies, European Economic Commissioner Paolo Gentiloni said on Thursday.
The idea of a European Sovereignty Fund was first floated by the European Commission last year and is to be discussed by EU governments and institutions during a review of the bloc’s long-term budget in the second half of the year.
There are no details so far on its size, or how it could be financed, or whether it would offer grants or loans or both.
“If we want to be competitive, we need European added value and scale,” Gentiloni told a Politico economic conference, when asked about the fund idea.
The EU wants to stay in the lead of new green technologies that reduce CO2 emissions and help fight climate change, facing strong competition from China and the United States which also want to dominate the fast growing and lucrative market.
The EU is already spending 37% of its post-pandemic 800 billion euro recovery fund to transform its economies to cut emissions. The money is allocated according to the impact the pandemic had on countries, with some getting a lot more money than others.
Gentiloni said the future EU sovereignty fund could be different — rather than transfer money from stronger EU economies to weaker ones, it could pay for joint EU projects that are equally important to all, like clean hydrogen.
“If we have a common EU project, for example like clean hydrogen, this is in the interest of all,” Gentiloni said.
“It is not a transfer from stronger to weaker economies — it is a common project,” he said.