European Commission and EIB launch €500M broadband fund
The European Commission and the European Investment Bank (EIB) have announced a new fund aiming to encourage investment in broadband infrastructure across remote and rural areas of Europe.
The Connecting Europe Broadband Fund should be worth at least €500 million through a combination of public and private investment. The European Commission’s contribution is €100 million through the Connecting Europe Facility.
The broadband fund is a key part of the Commission's Gigabit Society strategy, which has targets to provide gigabit connectivity to all socio-economically important locations, such as schools and public sector providers, and 100Mb/s broadband for all of Europe’s citizens by 2025.
Günther H. Oettinger, Commissioner for Digital Economy and Society, said the broadband fund “is an important development for smart and efficient funding of broadband projects, especially in underserved areas, in line with the spirit and the letter of the Investment Plan. It is a great step towards a European Gigabit Society for all.”
The fund has already gained the backing of three national promotional banks and institutions that aim to participate in the initiative as anchor investors: KfW Bankengruppe from Germany, Cassa Depositi e Prestiti from Italy and Caisse des Dépôts et Consignations from France.
The fund will provide investments between €1 million and €30 million, for projects with total costs of €150 million or less. Thus, smaller companies looking to deploy broadband infrastructure will be able to access funding that was previously unavailable to them as a result of their size and risk profile.
“High-speed internet is fundamental to the success and development of businesses,” said EIB President Werner Hoyer. “Until today, smaller-scale broadband projects did not have easy access to funding and EU financial instruments did not exist. Consequently, projects in less populated or rural areas, where purely private-led initiatives may not see the economic benefits of deploying broadband networks, were difficult to implement. The new fund will help bridge this market gap, and I am glad that the EU Bank is part of this joint initiative.”
The Connecting Europe Broadband Fund aims to invest in some 7 to 12 broadband projects each year from 2017 to 2021 and aims to have invested in 20 countries by 2021. Overall, the Fund is expected to unlock additional investments between €1 billion and €1.7 billion for broadband deployment in underserved areas, where very high-capacity networks have not yet been deployed.
The fund is expected to be open for applications from mid-2017. Cube Infrastructure Managers, a reputable investment firm with extensive experience in infrastructure and ICT projects, has been selected via a public procurement process carried out by the EIB over the summer of 2016, to manage the fund.