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EIB action in LAMC 2021
In 2021, most European Investment Bank loans in the area were made to public sector borrowers with a focus on climate change and environmental sustainability.

In 2021 the EIB supported the renewable energy sector with €315 million in loans to two private sector project developers.

The European Investment Bank collaborated with the Argentinian government to provide the country with $100 million to assist in the acquisition of COVID-19 vaccinations and the implementation of vaccination programs in accordance with the national vaccine deployment strategy.

In Barbados, the EIB is collaborating with the national government to fund €50 million ($60 million) in emergency healthcare spending connected to COVID. The EIB loan will assist in covering the expenses of enhancing Barbados' public health system, such as COVID-19 treatment capacity, lab capacity and equipment, quarantine facilities, IT equipment, vaccine storage, contact tracing systems, and logistics, transport, and monitoring operations.

The Caribbean Development Bank (CDB) collaborated with the European Investment Bank in 2021 to provide $36 million to CDB's Borrowing Member Countries (BMCs) for health-related emergency expenditure, focused on the COVID-19 vaccines and other investments in healthcare in an effort to limit the virus's spread.

In Buenos Aires, 1.4 million individuals are at risk of floods. To reduce the impact of floods and droughts on the basin's economy and to help development in the region, in 2021, Argentina signed a flood protection loan agreement with the European Investment Bank. The $110 million 25-year EIB loan will support integrated water resource management in the Salado River Basin in Buenos Aires. The World Bank has agreed to co-finance the initiative with a loan of $111.6 million.

In Brazil, a €200 million loan to support renewable energy projects will allow Neoenergia to establish a wind farm and solar power plant.

The new arrangement will support a series of onshore wind farms divided into two clusters in the Brazilian states of Paraba, Piau, and Bahia, as well as a solar photovoltaic plant to be erected roughly 10 kilometers away from the wind cluster in Paraba. The total capacity installed is 574 MW (425 MW of wind power and 149 MW of solar power).

The EIB has made a €50 million senior equity investment in the Emerging Market Climate Action Fund (EMCAF), a new fund of funds with a €500 million target size managed by Allianz Global Investors and advised by the EIB.

The European Investment Bank is also collaborating with a private equity fund to invest in small and medium-sized firms (SMEs) in Latin America that support climate action and environmental sustainability. The $200 million GEF Latam Climate Solutions Fund will contribute to the achievement of the Sustainable Development Goals (SDGs), notably those aimed at mitigating climate change.

The Latam Energy-Efficient Housing fund received $150 million from the European Investment Bank, to build energy-efficient affordable housing and social infrastructure assets in Colombia and Peru's healthcare and education sectors. The projects will be built in accordance with the Fund's green housing standards.

El Salvador received a loan from the European Investment Bank for the first time in 2021, a framework $40 million loan to the country's deevlopment bank, Banco de Desarollo de el Salvador. The loan is for small enterprises and climate action investment projects.

The $40 million loan will be channeled directly to firms by BANDESAL or through one of its development funds, the Economic Development Fund (FDE). $20 million will be used to assist investments in renewable and energy efficiency projects (such as solar photovoltaic, biogas, and micro hydro projects). Up to 50% of the loan line will be used to assist small and medium-sized businesses affected by COVID-19's present economic issues.

Under the FELICITY program, the EIB and Ecuador's Banco de Desarrollo are collaborating with Germany's GIZ. FELICITY is a project preparation facility supported by the German International Climate Initiative (IKI) and operated in collaboration with GIZ. The program assists project developers in cities with feasibility studies and other preparation procedures, as well as providing capacity-building assistance to the Banco de Desarrollo del Ecuador.

The Clean Oceans Initiative
The annual value of products and services generated by marine and coastal resources is projected to be €2.5 trillion.

The effort focuses on the worldwide management of waste, wastewater, and stormwater, with a special emphasis on riverine and coastal areas in Africa, Asia, and Latin America. To be qualified, initiatives must demonstrate efficient and effective methods of minimizing plastic waste or microplastics output.

The European Investment Bank, in collaboration with the French and German development banks Agence Française de Développement (AFD) and KfW, started the initiative in October 2018 with the goal of investing €2 billion in projects that reduce plastic waste by the end of 2023. By the beginning of 2022, more than 80% of this target is achieved, with initiatives benefiting more than 20 million people throughout Africa, Asia, Latin America, and Europe.

At the One Ocean Summit in February 2022, when the European Bank for Reconstruction and Development (EBRD) became the Clean Oceans Initiative's sixth member, the initiative stated that it would increase its financing aim to €4 billion by the end of 2025.

KfW authorized a €80 million loan to assist Cape Town in improving and expanding different municipal wastewater treatment plants, as well as a €1.2 million grant for training and a €4.5 million grant for city-supporting measures. The upgrades will allow the city to use recycled water for agricultural or industrial purposes. The project would assist Cape Town in meeting its expanding water demands and dealing with droughts.

In Cape Town, providing clean water to more than 4 million people and handling wastewater are major difficulties. The aging infrastructure is unable to keep up with the increasing population expansion. The South African coastal city has 26 treatment plants, some of which date back to the 1950s, and many of them are ineffective.

Sri Lanka's wastewater management requires a lot of work. Only approximately 2.5 percent of the population, primarily in the Colombo region, has access to sewers.

AFD is working to improve sanitation services in Ratmalana and Moratuwa, two heavily inhabited and rapidly increasing coastal communities. It authorized a €75 million loan to repair the two cities' sewage systems. This initiative will provide better sanitation services to 44 500 individuals, with a focus on gender equality.

In Cotonou, 10% of the country's population resides. Heavy rains in Benin in 2010 caused widespread flooding, causing significant damage and financial losses. Heavy rains have continued to fall in the area, and large volumes of plastics and other debris are being released into Lake Nokoué and the Gulf of Guinea via open drains.

The European Investment Bank provided a 50 million loan to help Cotonou in improving stormwater management and protecting the city from recurring flooding. The initiative will enhance coastal regions by upgrading stormwater drainage to capture plastic garbage. It will lessen floods near buildings and rainfall stagnation in urban areas. This will benefit 187, 000 people in and around Cotonou while also reducing plastic and other pollutants in the Gulf of Guinea.

In Alexandria, the wastewater treatment system was established in the early 1990s and can no longer properly support the population. High quantities of pollutants, including microplastics, have entered the neighboring Lake Mariout and the sea as a result. Alexandria's growing population makes it even more critical to enhance sanitary facilities.

The EIB approved a €120 million loan to assist Alexandria in improving wastewater treatment and upgrading the facility. The effort will also help to limit the quantity of plastic that ends up in the ocean. Sludge treatment is part of the project, which will generate biogas and minimize the need of fossil fuels. More than 1.5 million individuals will benefit from the investment.

KfW, on behalf of the government of the Federal Republic of Germany, signed a €150 million loan to finance city upgrading projects along the Yangtze River. KfW collaborated with the World Bank to administer the loan, signing an extra $200 million loan in a cooperative effort to prevent pollutants from entering the river and ocean in the first place.

AFD is enhancing living conditions in Lomé, a huge coastal city with a population of 1.4 million people, by modernizing solid waste management services. The project involves boosting garbage collection in a variety of ways, including the development of an international-standard landfill.

The Clean Oceans Initiative decided to increase its objective to deliver €4 billion in finance by the end of 2025, rather than the €2 billion previously planned by 2023.

The Clean Oceans Initiative is the largest collaborative effort devoted to sponsoring initiatives aimed at decreasing plastic waste at sea. In three years, the Initiative has already achieved 80% of its goal by providing € 1.6 billion in long-term financing for public and private sector projects that reduce the discharge of plastics, microplastics, and other litter to the oceans through improved solid waste, wastewater, and storm water management.

Every year, an estimated 8 million tonnes of plastic garbage reaches the oceans. Estuaries, coral reefs, fish, and millions of households that rely on the waters are all threatened by pollution. The majority of the plastics in the seas come from debris that has been dumped on the ground or washed into rivers. Improved wastewater treatment and stormwater management in many poor nations would prevent part of the 1.5 million tonnes of microplastics from entering the seas each year. Plastic pollution is growing due to rapid population increase in numerous places across the world.

Climate survey results

33% of car buyers in Europe will opt for a petrol / diesel car when purchasing a new vehicle. 67% of them mentioned opting for the hybrid or electric version.

45% of young Chinese people fear they could lose their jobs because of the fight against climate change, 32% of young Americans fear they could lose their jobs because of the fight against climate change 31% of British people aged 20-29 fear they could lose their jobs because of the fight against climate change.

93% of Chinese respondents, 91% of EU citizens and 97% of British citizens, and 77% of Americans prefer a minimum 5-year guarantee on any electric or electronic product.

69% of EU citizens, 71% of UK citizens, 62% of US respondents and 89% of Chinese respondents support a tax on the items and services that contribute the most to global warming.

39% of Europeans tend to prefer hybrid vehicles, while 33% prefer petrol or diesel vehicles. The least preferred type of vehicles are electric cars, preferred by 28% of Europeans.

44% Chinese car buyers, on the other hand, are the most likely to buy an electric car, 38% of Americans would opt for a hybrid car, 33% would prefer petrol or diesel, while only 29% would go for an electric car.

Specifically for the EU, 47% of car buyers over 65 years old are likely to purchase a hybrid vechile, while 31% of younger respondents do not consider hybrid vehicles a good option. 35% would rather opt for a petrol or diesel vehicle, and 24% for an electric car instead of opting for hybrid ones.

In the EU, only 13% of the total population do not plan on owning a vehicle.

Climate change is a factor that 67% of Europeans consider when choosing where to go on holiday. Specifically, people under the age of 30 are more likely to consider climate implications of vacation spots.

52% of young Europeans, 37% of people ages 30-64 and 25% of people aged above 65, state that in 2022 they will choose to travel by plane. 27% of young people claim they will travel to a faraway destination.

42% of Europeans, specifically 48% of women and 34% of men, already invest in second-hand clothing rather than buying new ones.Younger populations, aged 15 to 29, are found more likely to do so.

When choosing a bank or investing savings, 45% of Europeans consider climate change. Young Europeans between 15-29 are most likely to consider this. 70% of Europeans also take into account climate change when voting.

In the EU, 75% of the population claims they are more worried about the climate crisis than their politicians. For Britain, this number is at 69%, while for Americans it is at 59%.

51% of EU citizens cite government inaction as a major difficulty when facing the climate crisis.

Most of the residents in the European Union, the United Kingdom, the United States and China agree that climate change and its repercussions are the most serious threat to mankind in the twenty-first century. This percentage is greatest among Chinese respondents, who agree with this statement 93% of the time, followed by EU citizens (81%), British (74%) and Americans (59).

81% of residents in the European Union argue that climate change and its repercussions are the most serious threat to mankind in the twenty-first century.

Stronger policies are supported by 91% of Chinese respondents, 73% of Britons, 70% of Europeans and 60% of Americans.

70% of Europeans support stronger policies for climate change mitigation.

63% of EU residents, 59% of Britons, 50% of Americans and 60% of Chinese respondents to an EU survey are in favor of renewable energy.

For Americans, natural gas seems to be a more accepted transition source of energy, with 18% in favor. For Britons and EU citizens, nuclear energy is a more popular energy alternative.

Education on sustainable consumption, specifically targeting children, is seen as a priority by 93% of Chinese citizens, 92% of EU, 88% of British citizens and 81% of Americans.

69% of EU citizens, 71% of UK citizens, 62% of US respondents and 89% of Chinese respondents support a tax on the items and services that contribute the most to global warming.

Climate initiatives, according to 56% of Europeans, are a source of economic growth.

56% of Europeans also believe that climate change mitigation will also produce more employment.

According to 61% of Europeans, climate change policies will improve their quality of life.

25% of Europeans fear losing their work because it will become incompatible with the need to combat climate change, especially younger generations aged 20 - 29 (44%).

According to 66% of respondents to an EU climate survey, climate change will still be a severe concern by 2050.

61% of Europeans feel that climate change mitigation will lead to a greater quality of life, specifically when it comes to daily lives and overall health. Europeans, however, believe this less than Chinese people (77%), Americans (65%) and British people (63%).

Policies that address the climate emergency are also seen favorably by the labor market: According to 56% of Europeans, initiatives will have a net positive impact on employment, generating more jobs.

Europeans expect lifestyle changes to experience great transformation in the next 20 years. 31% of respondents to an EU climate survey (link to EIB) believe that most people will no longer have their own vehicle, while 63% believe that teleworking will become the norm in the fight against climate change. 36% of respondents believe most people will no longer consume animal products. 48% predict that energy quotas will be individually assigned.

The majority of individuals in the eastern EU countries are relatively less positive about the influence of climate measures on the employment market.

55% of Eastern Europeans believe that these measures will result in the loss of more employment than they generate. In contrast, 60% of respondents in Western EU nations believe that these measures would generate more.

62% of Europeans believe that the green transition will reduce their buying power.

While 30% of Europeans believe the climate emergency will be under control by 2050, 66% believe it will still be a severe problem by the mid-century.

Europeans believe climate climate change according to European respondents, is a threat to their home. When questioned about the long-term consequences of the climate problem, one-third of the EU population (29%) expects to be forced to relocate to another area or nation. This fear is even stronger among persons aged 20 to 29, with half of them concerned about the potential of having to relocate due to climate challenges.

Blog stories

In 2011, the Andalusian Social Survey on Mobility in Metropolitan Areas found that women make up 65% of public transportation passengers and 59% of pedestrians in Andalusia.

According to the Feasibility Study for the Extension of the Granada Metro, 65% of women prefer to use the metro, and women are less likely to drive than males. Multiple studies found that 71% of women prefer to be car passengers as opposed to drivers.

According to Andalusia statistics, women make the majority of excursions (65%) to accompany children and to shop (63%). They also do health-related trips (61%). Work trips (58%) are predominant for men, as well as business-related trips (81%) and leisure trips (58%).

Women are the most frequent users and promoters of sustainable mobility, yet this is not always represented in transportation plans, strategies, and initiatives.

Based on a survey of European transport employees, the 2019 Report on Violence Against Women in the Workplace exposes frightening evidence of high levels of violence against women at work across Europe. Twenty-five percent (25%) of the women polled felt that violence against women is a common occurrence in the transportation industry, and 26 percent say that harassment is considered "part of the work" in the transportation industry.

EIBIS 2021

Due to the COVID-19 pandemic, 49% of EU enterprises saw a drop in sales, compared to 21% who saw a boost.

Enterprises that were less productive before to the crisis were hit harder, but digital firms were more robust.

Sales were down more for small businesses (by at least 25%) than for medium and big businesses.

The number of firms carrying out investment in the last year declined to 79% from 86% in 2019.

In response to fewer sales, 23 % reduced their investment intentions, while just 3% intended to increase their investment.

Businesses in Europe received governmental support following the economic crisis. Governments ensured that enterprises had access to financing, with some governments covering labour expenses so that people could remain employed. This initiative targeted enterprises experiencing the greatest revenue loss, and the companies who got assistance were more likely to stick to their investment goals.

56% of EU enterprises got some type of governmental help, such as guaranteed credit, assistance with social security contributions, or delayed payments.

Without government assistance, 35% of European small and medium-sized firms (SMEs) in manufacturing and services indicated their businesses would have faced an existential danger.

The COVID-19 pandemic opened up new opportunities for digital technologies. European firms have had to adapt during this time, and will have to continue to do so. Simultaneously, there is a growing concern for the effects of climate change and the impact this will have on their future operations.

According to 55% of businesses, the pandemic has increased the demand for digitalization. 46 percent of businesses report that they have grown more digital.

34% of enterprises that do not yet utilize advanced digital technology saw the crisis as a chance to begin their digitisation journey.

Approximately 58% of EU enterprises are concerned about the physical hazards of climate change, particularly in areas prone to extreme weather.

Climate change was addressed by 43% of EU enterprises. Despite the pandemic's toll, the percentage of enterprises planning climate-related investment has climbed to 47% from 41% in 2020.

As financial and economic conditions normalize, policy should focus on increasing the momentum for green and digital investments, which will ultimately make Europe more competitive. However, in order to do so, Europe must address fundamental investment hurdles.

79% of businesses believe a lack of personnel with the necessary skills is impeding their development and investment plans.

Firms' investments in climate change are being hampered by uncertainty about the regulatory environment and taxation.

At the start of the COVID-19 pandemic in the economy, aggregate investment levels fell in the second quarter of 2020. The corporate sector was the most responsible for this reduction. Investment appeared to be increasing in early 2021, coinciding with the relaxation of COVID-19 restrictions.

European Union companies in 2020 spent half of their investment on replacement, specifically ranging from 46% in manufacturing and 57% in construction. Latvia showed the highest amount of investment in capacity expansion, at 38%, while Cyprus showed the lowest. This within the EU amounted to a total investment of 25%. Investment in new products and services was the highest in Ireland at 29% and lowest in Croatia at 10%, but accounted for a total expenditure of 17%, lower than in 2020. Allocation for investment on replacement was the highest in France at 61%, and the lowest in Ireland at 30%. European enterprises' investment in intangible assets (R&D, software, training, and business processes) grew slightly in 2020 compared to what was stated in EIBIS 2020 for 2019.

Croatian, Bulgarian, Hungarian, and Polish firms invested the least in intangible assets. Ireland and Cyprus have the largest proportion of intangible assets.

The COVID-19 outbreak has had a significant impact on sales. When questioned about the impact of COVID-19 on sales or turnover, 49% of all EU enterprises claim that their sales have decreased since the start of 2020, before COVID-19 impacted the economy. On average, US enterprises were 38% more likely than 21% of EU firms to have boosted their sales.

Malta 58% and Portugal (54%) have the biggest proportion of enterprises facing a fall in sales, while Ireland and Romania (both 31%) have the highest proportion of firms whose sales have climbed since the beginning of 2020.

When compared to the United States, fewer EU enterprises (57 percent) report having taken at least one short-term action as a result of COVID-19. The most often mentioned area of action or investment, as indicated by 46 percent of EU enterprises, is to become more digital.

Austria (59%) and Sweden (58%) have the highest proportion of enterprises reporting increased digitalization as a result of COVID-19, while Bulgaria (24%) and Croatia (32%), have the lowest proportion.

30% of EU firms reported in the European Investment Bank's Investment Survey 2021 that they adjusted their investment expectations to fit the COVID-19 pandemic. This is reported as more than the US where the positive revision of investment plans was more common, with 25% of firms reporting.

When asked if they had changed their investment expectations during the pandemic, just 3% of EU enterprises said they had raised their investment during this period, while 26% of EU firms said they had moved their investment intentions downwards.

Construction companies are the least likely to have changed their investment plans downward, with only 15% doing so, while manufacturing firms are the most likely at 29%. Romania (38%) and Belgium (33%), have the highest proportion of enterprises that have altered their investment plans downwards, while Denmark (85%) and Cyprus (83%) have the highest proportion of firms whose plans have not been influenced by COVID-19. 36% of EU enterprises that had seen a negative sales effect were modifying their investment plans downward, far more than the 26% in the US.

The highest proportion of enterprises that have reduced their investment plans due to a drop in sales are in Poland, where 49% of firms have reduced investment and Belgium where 47% have done the same.

82% of European Union enterprises believe they had investment the right amount over the past three years since 2020. The same had been reported in the 2020 findings of the European Investment Bank Investment survey for United States firms. 14% of EU firms report that their investment activities were too low, similar to the 2020 findings.

The proportion of EU enterprises working at or over full capacity 49% in 2020 has decreased, compared to the findings from the EIBIS 2020 (61%). In the United States, there has been a reduction in the number of enterprises running at or near full capacity (39 percent vs. 49 percent, respectively).

60% of companies in Denmark report working at or over full capacity in 2020, while 35% firms in Ireland and Latvia report the same.

Companies in Malta, the Netherlands, Slovakia, Croatia, and the Czech Republic had the greatest decrease in the proportion of firms working at or above full capacity as compared to EIBIS 2020.

72% of EU enterprises and 79% of US firms state that the COVID-19 pandemic will have a long-term influence on requirements and priorities.

The main long term impact of the COVID-19 pandemic has been found to be an increase in the use of digital technologies by companies. 55% of EU firms reported that COVID-19 will increase the use of digital tech in EIBIS 2021, while in EIBIS 2020 only 50% reported the same.

63% of large firms and 61% of infrastructure firms and 58% in the service sector are the largest share of firms expecting long term effects of COVID-19.

Real investment in the European Union has fallen by a startling 14.6 percent by the end of the second quarter of 2020, compared to the fourth quarter of 2019. However, it soon recovered and returned to its 2019 level by the second quarter of 2021.

Data from the European Investment Bank's Investment Survey (EIBIS) show that the impacts of the crisis on enterprises are typically unequal. Due to the pandemic, 49 percent of EU enterprises saw a decrease in sales, while 21 percent saw an increase.

Low (pre-crisis) productivity was found to be a substantial predictor of lost revenues, with more digital enterprises demonstrating slightly more resilience. Small-business sales fell significantly (at least 25%) more frequently than medium- and large-business sales.

The proportion of enterprises reporting previous-year investment activity fell from 86 percent in the EIBIS 2020 survey to 79 percent in 2021. Faced with declining revenues, 23% of businesses changed their investment plans, with only 3% intending to invest more.

Due to the European Union's prompt response, its governments were able to absorb the majority of the income lost by people as a result of the pandemic while also preventing enterprises from going out of business.

The first step was to suspend the Stability and Growth Pact's deficit and debt limits, allowing for coordinated national budgetary responses.

The second featured subsidies and subsidized loan facilities granted to enterprises and people at the national level, supplemented by the SURE job protection facility, the European Guarantee Fund, and the crisis response of the European Stability Mechanism.

The third consists of major purchases of eurozone government bonds by the European Central Bank. Despite rising debt levels, national funding costs remained low or even fell as a result of these acquisitions.

While families' primary income fell by 7.3 percent in the second quarter of 2020 compared to the same time the previous year, their secondary income (from social security payments and other transfers) increased by 6.5 percent of gross income, more than covering the loss.

In mid-2021, the European Union's gross saving rate was still 18% of gross disposable income, higher above the pre-pandemic average of 11-13%.

The combination of lower output and higher current expenditure resulted in a significant increase in government debt. EU debt has been dropping since 2014 as a result of fiscal austerity, but these gains were reversed in 2020-2021, and debt throughout the bloc has again reached 2014 levels. Although borrowing prices are not now under pressure, large levels of sovereign debt are a cause for worry in light of the probable reintroduction of the EU fiscal framework and normalization of monetary policy.

The pandemic has affected sectors differently, with the number of enterprises losing money in the hotels, restaurants, arts, and leisure industries reaching roughly 25% compared to normal times, and transportation also being affected.

In Europe, 33% of jobs are within enterprises that have not digitally transformed. In the United States, 20% of jobs are within firms that have not digitally transformed. These are called "sleepwalking enterprises", and are also more likely to pay lower wages and to create lower employment. They were also less likely to train their employees throughout the COVID-19 outbreak.

Climate Bank Roadmap (Publication)

2019 was the second-warmest year in the previous 140 years, according to the latest Global Climate Report. Since 2015, the five hottest years in the 1880-2019 dataset have all happened. This is accompanied by an unparalleled rate of biodiversity loss and major risks to global ecosystems. These developments raise the risk to individuals – to the well-being of today's generation and future generations.These effects are expected to be felt disproportionately by the poorer communities and regions across the world.

The European Union has become the first area to embrace climate neutrality by 2050 through the European Green Deal, and it has committed to forming Green Alliances with partner nations and regions across the world.

To meet the long-term United Nations Sustainable Development Goals (SDGs), sustained long-term investment in green innovation is required: to decarbonize the physical capital stock – energy, industry, and transportation infrastructure – and ensure its resilience to a changing future climate; to preserve and enhance natural capital – forests, oceans, and wetlands; and to train and reskill people to work in a climate-neutral economy.

The European Union has taken strong action to assure recovery through Next Generation EU, a €750 billion plan comprised of grants and loans. Nonetheless, the COVID-19 recovery is expected to dominate global public finances in the near term, heeding demands from various stakeholders to ensure that short-term expenditure in support of recovery is consistent with long-term goals.

The European Investment Bank Group is able to assist the development of a broader creative, green ecosystem through the European Investment Fund: venture capital funds, technical transfer, business perspectives, and private-sector equity (infrastructure funds) in general.

In terms of climate resilience, in February 2019, the European Investment Bank established a Climate Risk Assessment (CRA) system. In a significant breakthrough, all new investment projects are now routinely tested for climate change risk throughout the evaluation stage.

Increased summer heatwaves and droughts in southern Europe, as well as winter floods in Central Europe, pose major concerns. According to estimates, the EU economy might contract by 3% as early as 2050, with southern and south-eastern Europe suffering the most.

In early 2021, the European Commission presented a new EU Adaptation Strategy. Following a favorable assessment of the 2013 EU Adaptation Plan, it has issued a Blueprint for a new, more ambitious EU strategy, emphasizing the high cost-benefit ratios of adaptation measures and outlining potential features for a "European Green Deal adaptation strategy" aimed at improving understanding, reinforcing planning, and accelerating action.

Before 1970, almost half of all European residential structures were built. At the time, no consideration was given to the amount of energy used by materials and standards. At the present rate of refurbishment, reaching a highly energy-efficient and decarbonised building stock might take more than a century. One of the major aims of the European Green Deal is to “at least double or even triple” the current refurbishment rate of approximately 1%. This is also true outside of the EU, particularly in the Neighbourhood region. In addition to rehabilitation, investment is required to enable the development of new efficient and ecologically friendly structures.

For over a decade, the European Investment Bank has managed the European Local Energy Assistance (ELENA) facility on behalf of the European Commission, which provides technical assistance to any private or public entity in order to help prepare energy-efficient and renewable energy investments in buildings or innovative urban transportation projects.

The European Union Modernisation Fund, formed in 2018 as part of the new EU Emissions Trading System (ETS) Directive and with direct engagement from the EIB12, targets such investments as well as energy efficiency and a fair transition across 10 Member States.

Given the significant threat that oceans face, the European Investment Bank Group aims to increase its funding and advisory assistance for ocean cleanup. For example, the Clean Oceans Initiative (COI) was established in 2018. The European Investment Bank, the German Development Bank, and the French Development Agency (AFD) agreed to invest a total of €2 billion under the COI from October 2018 to October 2023 in initiatives aimed at reducing pollution discharge into the oceans, with a special focus on plastics.

According to the European Green Deal, it is critical to minimize reliance on pesticides and antimicrobials, eliminate excess fertilization (particularly nitrogen and phosphorus), promote organic farming, improve animal welfare, and reverse biodiversity loss. The introduction and successful implementation of sustainable agriculture can assist developing nations improve their food security, as well as strengthening soil and plan carbon sinks globally.

Cities globally house half of the world's people, consume two-thirds of the world's energy and 70% of its natural resources, and contribute more than 70% of global CO2 emissions. Cities and regions are also particularly vulnerable to climate-related hazards and pollution. Climate danger and pollution also disproportionately affect the poor, increasing inequality. It is projected that urban growth will expand by 60% during the next 30 years. There is an urgent need for more green oriented urbanisation by constructing smarter and more environmentally friendly buildings and infrastructure.

URBIS is a new specialized urban investment consulting platform that assists local governments in facilitating, accelerating, and unlocking urban investment. The City Gap Fund, which is co-managed by the EIB and the World Bank, assists cities and local governments in developing and prioritizing climate-smart strategies and investments. It is the 20th EIB Group Climate Bank Roadmap 2021-2025, with a goal of raising at least €100 million in total finance to leverage more than €4 billion in investment for urban climate action. Circular economy initiatives have a lot of promise in the context of sustainable cities. Building on its Circular City Funding Guide, the European Investment Bank is launching a variety of projects in this area.

The European Investment Bank fully supports three major efforts that will play a critical role in facilitating the establishment of a worldwide sustainable finance sector: (1) the Greening the Financial System (NGFS) Network of Central Banks and Supervisors; (2) the Coalition of Finance Ministers for Climate Action; and (3) the European Commission's International Platform on Sustainable Finance.

The European Investment Bank has been a significant source of EU financial support in the framework of the "Copenhagen commitment 14." In 2015, the EIB promised to increase its share of loans to developing nations for climate action to 35% by 2020. This goal was already fulfilled in 2017 and will be accomplished again in the next years.

JASPERS has been critical in giving early-stage project assistance to promoters, assisting them in increasing their efforts in creating low-carbon projects and guaranteeing their resilience to climate change-induced consequences. More than 180 significant initiatives were authorized for finance with JASPERS support between 2014 and 2019, totaling €58 billion in investment and €31 billion in EU funds. Half of these investments went toward climate change mitigation.

This amounts to €3.15 billion in 2019, indicating the significant, beneficial effect advice for early-stage project development may have on increasing the project pipeline aligned with climate action and environmental sustainability.

The European Investment Bank's green debt offer, which is currently limited to a green energy loan product, is being expanded to include a green loan product in response to market demand for standardised and transparent green debt instruments (which will address the problem of "greenwashing") and increasing financing needs to fund green investment.

This product provides for greater eligibility in accordance with the new climate action and environmental sustainability standards, allowing the EIB to issue green debt to assist a far broader variety of industries and projects, not only those in the energy sector.

As a financing tool, the European Investment Bank is also creating a green bond product, including green hybrid bonds (i.e. as a loan substitute). This would allow the EIB to engage in the green bond market as both an issuer and a buyer, which is a natural progression after the EIB Group successfully pioneered a green bond product in the capital markets in 2007.

Cohesion policy was one of the EIB's core reasons when it was established in 1958. It remains a top priority, as evidenced by a 30 percent annual target for Cohesion lending across the EU and pre-accession countries. This commitment is not jeopardized by the new green goal; rather, assistance for a fair transition and a socially inclusive approach is a tool for the EIB Group to strengthen its commitment to balanced territorial development.

The Just Transition Mechanism (JTM), an integral part of the Sustainable Europe Investment Plan, is expected to mobilize €100 billion in investments during the 2021-27 MFF, with funding from the EU budget and Member States, as well as contributions from InvestEU and the EIB (European Commission, 2020).

the Just Transition Mechanism provides a comprehensive set of support options for the most vulnerable regions. The Just Transition Fund, the first pillar, will primarily provide grants. The second pillar creates a specialized transition plan under InvestEU to leverage private investment. Finally, a new public sector credit facility is formed under the third pillar to leverage public finance. These measures will be accompanied by specialized advisory and technical assistance for the affected regions and projects. The Just Transition Mechanism will include a robust governance framework based on territorial Just Transition Plans.

The Just Transition Fund (Pillar 1) of the JTM will make €17.5 billion in EU grants available to the most affected territories, implying a national co-financing requirement of around €10 billion. Where possible, the EIB Group will be able to support this through Structural Programme Loans in conjunction with European structural and investment funds (ESIF) co-financing operations.

The public sector loan facility is expected to unlock at least €25 billion in investment for eligible territories between 2021 and 2027. The EIB, as the EU's financing partner for the facility, is expected to provide €10 billion in loans, which will be matched by an investment grant equal to 15% of the EIB loan (up to 20% in less-developed regions), increasing the affordability of transition projects, ensuring their appropriate scale, and accelerating their implementation.

Since 2015, the EaSI Guarantee Instrument (EU Programme for Employment and Social Innovation), managed by the EIF, has provided over €280 million in guarantees across Europe and is expected to provide over €3 billion in financing to microenterprises and social enterprises. In the coming years, the EIF intends to continue providing assistance to these types of final beneficiaries in areas heavily impacted by the transition to a low-carbon economy.

Keeping the global mean temperature rise below 1.5 degrees Celsius will lower the number of people exposed to climate risk and vulnerable to poverty by 460 million. Furthermore, if the current warming trend continues, welfare losses in Europe are predicted to be 1.9 percent of EU GDP by the end of the century.

Targeted investments in renewable energy – both on and off-grid – can help the 1.1 billion people who now lack access to power while also addressing gender disparities.

Gender equality is also critical to achieving a fair transition. For gender equality, industrial changes present both possibilities and problems. In accordance with its Strategy for Gender Equality and Women's Economic Empowerment, the EIB Group will approach its support for a Just Transition through a gender lens.

Transport, together with electricity generation, is the major source of GHG emissions in the EU. GHG emissions from the transportation sector continue to rise, in contrast to power generation and nearly all other sectors. Since 1990, transportation emissions have increased by 30%. The transportation sector accounts for around 70% of these emissions. The majority of these emissions are caused by passenger vehicles and vans. Road travel is the second and third major source of GHG emissions from transportation, behind hiking and aircraft.

Other potential sustainable fuels are unlikely to be accessible on a large basis until beyond 2040, if at all. Flying will continue to be a carbon-intensive activity in the short term.

Because of the flexibility that road transportation provides, road infrastructure plays an important role in the efficient movement of goods and people. As a result, a high-quality road network contributes to regional economic growth and employment.

Effective road management and charging systems can aid in the efficient allocation of road capacity while minimizing environmental damage. Furthermore, even within a wide set of ecologically sound policies, specific investments in the transportation network can have a negligible or even positive impact on carbon emissions due to enhanced traffic flow.

In the present global economic downturn, and particularly in light of the problems faced by many smaller businesses, it is proposed to use the recommended values for ‘'Do No Significant Harm" criterion for automobiles, vans, and trucks across MBIL-type goods. This equates to limiting support to vehicles emitting less than the fleet average of 95g CO2 per km for passenger vehicles, 147g CO2 per km for light commercial vehicles, and less than the reference CO2 emissions for trucks per subgroup (in g CO2 per tonne-km). This, when applied vehicle by vehicle, guarantees that the EIB Group supports the more efficient (and smaller) half of the new fleet.

Waterborne transportation is still the least carbon-intensive mode of transportation on average, and it is an essential link in sustainable multimodal freight supply chains.

Since the maritime sector is not yet covered by the EU Taxonomy, the EIB will continue to support LNG-fueled vessels (recognizing that there is currently no viable zero or lower carbon alternative for most shipping segments and the positive impact of LNG on environmental pollution when compared to conventional fuels), but will withdraw support for vessels powered by conventional heavy fuel oil.

Almost 90% of European Investment Bank funding to industry supports an RDI goal, with the remaining 10% supporting broader environmental goals.

In the case of existing traditional EII facilities, support from the EIB Group is driven by energy efficiency, the circular economy, or pollution reduction. By modernizing the plant, such an expenditure may significantly prolong the asset's life, thereby postponing the shift to lower-carbon options. To assist minimize this risk, it is recommended to encourage projects with an economic life that expires before 2035.

Buildings, like industry, are directly responsible for around one-fifth of GHG emissions, primarily from space heating and hot water consumption. When combined with power consumption within buildings, this figure climbs to more than one-third.

Within the EU, the agricultural sector presently accounts for roughly 10% of total GHG emissions, with methane from livestock accounting for slightly more than half of this figure.

Over the previous two decades, climate-related losses in the EU totaled €300 billion. Climate-related disasters could affect roughly two-thirds of the EU population annually by the end of the century, with losses from flooding alone exceeding €1 trillion per year in a high-emission scenario. Even under a more optimistic scenario, damage to Europe's essential infrastructure may grow tenfold, to €34 billion per year.

As of the end of 2019, the EIB managed a portfolio of over 7 500 operations with over 4 000 counterparts, totaling roughly €560 billion in signed exposure, including €65 billion in loans provided in 106 different countries outside the EU.

While aligning with the EU Taxonomy in both approach and technical criteria, the EIB will also maintain its externally audited climate finance tracking system, which is harmonised with other International Financial Institutions (IFIs) and required for reporting on international climate finance to the OECD and UNFCCC.

The EIB Group will be a permanent member of the EU Sustainable Finance Platform, which will take over the work of the European Commission's TEG to continue work on the EU Taxonomy's climate-specific criteria and to develop criteria for the remaining four environmental objectives, as well as social objectives in the future.

In May 2019, the World Wildlife Fund (WWF) and AXA submitted a paper to the G7 Environment Ministers outlining the financial risks of biodiversity loss and proposing for the formation of a task group to determine how to assess them. Despite the fact that firms and their investors have previously been exposed to the financial consequences of natural capital, transparency is still in its infancy.

Several significant policy components are in place at the EIB to promote climate action and environmental sustainability. It has an Environmental and Social (E&S) Policy Framework with particular E&S Standards, which was established in 2013, and a Climate Strategy, which was adopted in 2015.

The Climate Strategy maintains the EIB's guiding principle. It is organized around three major action areas for the EIB's climate action: I enhancing the effect of EIB climate finance; (ii) strengthening resilience to climate change; and (iii) incorporating climate change problems into all EIB standards, techniques, and procedures.

The EIB Institute established the EIB Climate Change Policy and International Carbon Markets Chair at the European University Institute, as well as the Chair on Sustainable Development and Climate Transition at Sciences Po, in collaboration with other sponsors. Through its EIBURS, STAREBEI, and CAPSTONE programs, it supports relevant academic research at 14 universities, and its annual EIB Summer School (70 postgraduates from 10 EU institutions) will be dedicated to EIB Group climate action.

The EIB has reduced its exposure to projects with high transition risks by phasing out support for, for example, oil and natural gas production, traditional gas infrastructure (networks, storage, and refining facilities), and power generation technologies with emissions greater than 250 g of CO2 per kWh of electricity generated. With all new activities being Paris-aligned by 2020, the transition risks of new operations will be minimized even more.

The EIB's overarching goal is to finance 50% of climate action and environmental sustainability by 2025 and beyond, and the EIB Group's goal is to support €1 trillion in investments in these areas over the critical decade from 2021 to 2030.

Given the rising investment demands in the green economy, there is a strong argument for EU sustainability standards - partially to promote the internal market, and partly to prevent the danger of misappropriation (e.g., greenwashing). The creation of a single categorization system for sustainable activities (dubbed the "EU Taxonomy") is a crucial component of the European Commission's Action Plan on Financing Sustainable Growth.

In light of the Paris Agreement, the EIB's carbon pricing policy is being reviewed, with a focus on the cost of carbon necessary to drive the economy to reach the 1.5 C global temperature target. This is known as the carbon shadow cost.

The shadow cost is the total cost of the marginal measure necessary to achieve the climate goal. All investments that reduce carbon emissions for less than this amount are considered good. All efforts in carbon reduction that cost more than this amount are not warranted because there are lower-cost alternatives available. On Inequality Essay

While the bottom 80% of the European population's income has increased by an estimated 40% on average since 1980, the top 1%'s pre-tax income has more than doubled.

'''The global financial crisis and its aftermath were not a major source of inequality in Europe. Indeed, falling profits temporarily reduced top percentile incomes, while the crises increased hardship and economic insecurity among lower-income group. '''

Employment in the European Union reached a new high in 2019.

While many social and economic indicators have converged across EU regions, the global financial crisis resulted in a sharp divergence in unemployment rates. Recently, these ranged from less than 2% in Prague to more than 20% in parts of Greece, southern Spain, and southern Italy. Rapid technological change also had an effect on medium-skilled workers resulting in more low-skilled jobs being taken up.

Another important and underappreciated aspect of economic inequality is gender. Because women continue to hold lower-paying jobs, they earn 13% less than men on average across the European Union. According to European Quality of Life Survey and European Working Conditions Survey data, women in the European Union work more hours but for less pay. Adult men (including the retired) work an average of 23 hours per week, compared to 15 hours for women.

The surveys found that while men spend up to 14 hours per week doing unpaid housework and caring for children and other family members, women spend up to 28 hours per week doing the same unpaid tasks. Women work up to six hours longer than men. If all unpaid work done by men and women at the EU median wage were to be valued, it would be worth nearly €6 trillion, or 40% of European gross domestic product.

In the 2019 Eurobarometer survey, when people across Europe were asked to name the two most pressing issues confronting them personally, 18% mentioned health and social security, 15% pensions, 14% the environment, and 13% their own financial situation. Other economic and social issues followed, with crime (6%), immigration (5%), and terrorism (2%), in that order.

Whereas the baby boomers had more mobility than their parents, Generation X has had less. In Europe, improvements in mobility in terms of educational outcomes have also stalled for younger generations.

'''The availability of skills is one of the most frequently reported barriers to European firm investment, with innovative firms being more skill-constrained than most.  Investment Report 2020'''

Climate change and related weather events have had a significant influence on 23% of European companies, compared to 14% in the United States. Another 35% of European companies consider the consequences of climate change to be minimal.

Although 45% of EU companies have invested in climate change mitigation or adaptation measures, compared to 32% in the US, fewer companies plan to do so in the next three years. The proportion of investment varies from 50% in Western and Northern Europe to 32% in Central and Eastern Europe. A somewhat lower 40% of European companies want to invest in climate initiatives during the next three years. The majority of European companies, 75%, say regulatory and tax uncertainty is preventing them from investing in climate-related projects.

According to the EIB Municipality Survey 2020, 56% of European Union municipalities increased climate investment, while 66% believe their climate investment over the previous three years has been insufficient.

Although the use of digital technology by EU companies is increasing, it has not yet bridged the gap with the US. As of 2020, 37% of European businesses had not embraced any new digital technology, compared to 27% in the United States.

Municipal investments in digital infrastructure are increasing, but inequalities may lead to greater polarization. Over the period 2017-2020, 70% of European municipalities have boosted their expenditure in digital infrastructure.

A lack of digital infrastructure is viewed as a key barrier to investment by 16% of EU businesses, compared to 5% in the US.

Green companies in Europe outperform those in the United States in terms of green investment and digital uptake. In comparison to the United States, European businesses are less likely to have adopted digital technology, but they are more likely to invest in climate change mitigation or adaptation strategies. In Europe, the proportion of businesses that make green investments and are also digital adopters is slightly greater, at 32%. The same businesses are at 28% in the United States.

When the COVID-19 pandemic hit Europe, much of Europe's investment had been high, but it had unexpectedly slowed. In 2019, overall investment in the European Union increased by about 3% over the previous year, surpassing growth in real GDP.

Investment, like other economic activity, fell drastically as a direct result of lockdown restrictions. This effect was particularly noticeable in the second quarter of 2020, when investment decreased 19% year on year, as most limitations were relaxed by the summer.

In 2019, firms already had an unfavorable assessment of the economic situation. With the onset of the pandemic, economic morale has worsened significantly. Overall expectations for sector-specific business prospects, as well as the availability of internal and external funding, have deteriorated in the course of 2020.

81% of the European Investment Bank's Investment Survey respondents cited uncertainty as the most severe obstacle to investment.

As a result of the pandemic, half of European companies anticipate an increase in the usage of digital technologies in the future. The proportion is considerably greater among companies that have previously used digital technology.

20% of EU companies anticipate a permanent loss in employment, indicating that a sizable proportion of firms are pessimistic about their capacity to “bounce back” once the COVID-19 crisis has passed.

The European Union's public debt is expected to exceed 95 percent of GDP by the end of 2021, a 15 percentage point rise since the pandemic began.

From the first to the second quarter of 2020, the EU government debt grew by 8.4 percentage points to 88 percent of GDP. According to the European Commission, debt to GDP reached 94 percent by the end of 2020. In the autumn, a second wave of infection and lockdowns aggravated the problem.

After one year of the (COVID-19) crisis, corporate investment is expected to decline by at least 25%.

From 2019 to 2021, the government debt-to-GDP ratio was anticipated to rise from 79 percent to 95 percent.

Before the second lockdown at the end of 2020, the International Monetary Fund (IMF) and other organizations predicted that the European Union's GDP would contract by 6% to 8%, a drop unprecedented since the Great Depression.

The European Union's total real GDP fall was more than 11% compared to the first quarter of 2020, the biggest drop in a single quarter on record.

The reduction was caused by government attempts to restrict the virus's spread, and it varied greatly between Member States. It was weakest, on average, in Central and Eastern Europe, where real GDP decreased 9.7% in the second quarter compared to the first. It decreased by 11.5% in Western and Northern Europe, and by roughly 15% in Southern Europe. In comparison, real GDP in the United States fell by nearly 9% in the second quarter compared to the first quarter.

In the second quarter of 2020, disposable income per capita decreased dramatically, affecting consumer expenditure, particularly for lower-income, liquidity-constrained families.

The impact of the COVID-19 varied greatly on the industry, for example sectors that rely heavily on physical presence, including passenger transportation, the arts, entertainment, tourism, and hospitality, were impacted the worst, with declines of up to 30% in the second quarter of 2020 compared to the first quarter.

Others, including agriculture, banking, and real estate, declined by 3% or less during the same time span. During the global financial crisis, the distribution of economic effect across sectors was extremely varied, with EU manufacturing suffering the worst decrease - over 20% in the first quarter of 2009. The decrease in other sectors was relatively limited, at around or below 6%.

GDP per hour in the EU grew by 0.3 percent in the second quarter of 2020 compared to the same time in 2019, while GDP per employee decreased 11.5 percent.

In Western and Northern Europe, as well as Central and Eastern Europe, the unemployment rate climbed by roughly 0.5 percentage point (Figure 13a). The rise was greater in Southern Europe (1.5 percentage points). The United States increased by 4 percentage points during the same period, reaching a high of 10 percentage points in April in 2021.

The European Union's general government debt grew by 8.5 percentage points of GDP from the first to second quarters of 2020, reaching 88%. Finance in Africa 2021

The European Investment Bank committed €5 billion in new private and public investment throughout Africa in 2020 to assist in mitigating the effects of the COVID-19 pandemic, as well as addressing the economic consequences of the crisis. 71% of the funds were for the least developed economies. The overall finance will end up supporting more than €12 billion in projects in 28 African countries.

This financial support is estimated to help 210 million people be vaccinated against COVID-19, 595,400 homes to receive new electricity, 778,000 people getting a safer water supply. Farmers will also benefit from 26,500 hectares of freshly irrigated land and 3,076 hectares of newly planted forest.

In July 2021, the European Investment Bank committed to fund Senegal's first COVID-19 vaccine production factory. By the end of 2022, this factory is expected to manufacture up to 25 million doses of a licensed COVID-19 vaccine per month. This is part of a wide effort by the European Investment Bank to address the health and economic impact of COVID-19.

According to the International Monetary Fund (IMF), Sub-Saharan Africa requires $30-$50 billion in additional financing each year to adapt to the effects of climate change.

COVID-19 recovery will necessitate an extra $1 trillion in yearly funding, on top of the $2.5 trillion annual funding deficit for the pre-crisis Sustainable Development Goals.

Microfinance services are provided by commercial banks, commercial and regulatory microfinance institutions, informal providers, and non-governmental organizations. Formal microfinance institutions are a major source of credit, reaching around 6.3 million people in Africa in 2018, of whom 64% of whom were and 60% lived in rural regions. One of the responses of Africa's microfinance institutions to the COVID-19 crisis was to increase reliance on digital channels to support borrowers.

Private equity sectors have a chance to promote a smart, green, and inclusive recovery by assisting younger innovative enterprises in retaining access to funding and offering a source of capital for green and digital projects. Development financing institutions have a larger role in private equity in Africa than in other emerging and developing markets; this was notably noticeable during the epidemic, when other lenders were wary.

According to the OECD Development Centre, creating an enabling regulatory environment at the national level and strengthening regional regulatory cooperation can increase the use of digital financial services while lowering related risks.

According to the European Investment Bank's Banking in Africa study 2021, African institutions are becoming more conscious of the need to address the dangers posed by climate change and are beginning to capitalize on possibilities in green financing. For example, 54 percent of questioned banks saw climate change as a strategic concern, and somewhat more than 40 percent had people focusing on climate-related fronts. Sub-Saharan African banks are growing their digital offerings, which has been expedited by the COVID-19 pandemic. The majority of the banks polled said that the pandemic has accelerated the speed of digital transformation, and that this shift will be permanent.

The poor and vulnerable are most susceptible, with migrant workers, refugees, and other marginalised groups likely to suffer the most. GDP per capita is not likely to rebound to 2019 levels until 2024 (with risks tilting to the downside), and the crisis has reversed a predicted drop in the number of poor people (IMF, 2021a).

In comparison to pre-crisis forecasts, this might result in an additional 30 million people in Sub-Saharan Africa living in extreme poverty by 2021, as well as an additional nine million in the Middle East and North Africa (MENA) area.

According to Pangea-Risk, several African governments are experiencing criticism for a perceived lack of readiness, corruption scandals, and forcing new lockdowns too late, undermining trust in the state. Currently, twenty of the 39 nations on the World Bank's harmonised list of fragile and conflict-affected states are in Africa.

Fiscal stimulus packages in African countries through to mid-2020 amounted to roughly 1-2 percent of GDP, with monetary stimulus amounting to about 2% of GDP. This is close to the IMF's global average for low-income developing nations (around 2 percent of 2020 GDP over a one-year period from the start of the crisis). During the same era, developing markets adopted a package worth around 4% of GDP, whereas advanced countries executed a package worth approximately 16% of GDP.

Even in the absence of a significant fiscal stimulus program, the average fiscal deficit throughout Africa increased from 5% of GDP in 2019 to over 8% in 2020 as African nations struggled to address the health and economic repercussions of the crisis while enduring frequently dramatic revenue reductions. Due to a lack of fiscal headroom, the deficit resulted in increasing borrowing, which African countries have less capacity to absorb than established economies.

Prior to the pandemic, average public debt in Africa was predicted to progressively drop, but average net government debt increased by 2 percentage points in 2020, reaching 61 percent of GDP. The surge in Sub-Saharan Africa was significantly greater, topping 6 percentage points on average. Countries are suffering increasing debt payment expenses as a result of this rising debt burden, and others have lost foreign market access entirely, leaving them reliant on relatively limited internal resources and concessional finance.

The IMF predicts that average growth in Africa would return to 4.5 percent in 2021 and 4.0 percent in 2022, with all economies except the Comoros increasing in 2021. However, large differences in growth rates are expected, between 0.2 percent in the Republic of the Congo and 7.6 percent in Kenya in 2021.

In June 2021, Africa accounted for fewer than 1% of worldwide vaccine doses delivered, and the World Health Organization predicted that 47 of Africa's 54 nations would fall short of the aim of vaccinating 10% of their people by September 2021.

A lasting, inclusive recovery from COVID-19 would need an extra $1 trillion in yearly investment for poor countries, on top of the $2.5 trillion annual funding shortfall for the pre-crisis Sustainable Development Goals.

To support the COVID-19 recovery, Sub-Saharan Africa as a whole would need to raise expenditure by around 6% of GDP ($100 billion), whereas MENA would need to boost spending by 9% of GDP.

In early 2021, the European Investment Bank, with the help of the Making Finance Work for Africa Partnership (MFW4A), surveyed 78 banks in Sub-Saharan Africa (the EIB Banking in Africa study, 2021). The banks that took part control nearly 30% of the continent's assets. Almost two-thirds of Banks surveyed tightened lending rules, but more than 80% expanded their use of restructuring or loan moratoriums. Few banks were required to modify their employee levels, while slightly under one-third adjusted their prices. Approximately half of the answering banks had employee guarantees, the majority of which came from the central bank, the government, or an international financial institution.

89% of the banks polled claimed that the pandemic has hastened the digital transformation of their internal operations; the same percentage believes that the consumer movement toward digital channels will continue once the virus has ended.

Asset quality is expected to deteriorate more if policy measures are removed, even if economic growth begins to rise up. The impact of asset quality issues on bank loan books will most certainly cause banks to become more cautious: they will need to make provisions for non-performing loans (NPLs) and develop capital buffers to cover for inevitable write-offs.

During the first half of 2020, the cost of overseas borrowing climbed dramatically. Banks were well capitalized at the beginning of the pandemic, thus benefiting from supporting policy measures, and resisting liquidity challenges.

Previous research found that crowding out grew from 2014 to 2018, reaching high levels in a number of countries, including Ghana, Niger, Tanzania, and Zambia. In the aftermath of the global financial crisis, Africa's debt accumulation between 2008 and 2017 resulted in increasing public debt on bank balance sheets, higher interest rates on sovereign paper in several African nations, and collapsing banks. Given the enormous growth in indebtedness across Africa in 2020, there is a definite possibility of this cycle recurring, impeding recovery.

Northern and Southern African countries have taken the most total measures to address the financial sector crisis, with an average of 14 measures per country.

34 African nations have adopted steps to increase liquidity and lower borrowing costs, mostly through lowering the policy rate. South Africa, for example, has decreased policy rates by 200 basis points or more.

The most used measure has been to modify the handling of nonperforming loans by lowering provisioning requirements. To help banks get through the crisis caused by COVID-19, authorities have limited dividends or other uses of earnings, permitted the temporary release of capital buffers, eased capital or liquidity requirements, or made other temporary adjustments to prudential standards.

Countries in all African sub-regions have implemented payment-system-specific policies aimed at encouraging or facilitating the use of digital payment, as a result, reducing the cash.

In Latin America and the Caribbean, the situation is more challenging than in other regions, as just 31% of enterprises in need of a loan are being discouraged or denied.

African small businesses frequently struggle to get the cash they require to thrive. According to the SME Finance Forum, the formal financing gap for African SMEs averaged 17% of GDP across the 43 countries assessed in 2017.

COVID-19 Enterprise survey follow-up modules were conducted in nine African nations between 2020 and 2021, producing results consistent with a severe economic effect. Around 88% of enterprises in countries where COVID-19 follow-up surveys were conducted (three in Southern Africa, one in East Africa, four in West Africa, and one in North Africa) were suffering diminished liquidity, with more than 55% of them closing temporarily during the COVID-19 pandemic. Almost 8% had declared bankruptcy, and 26% of enterprises are past due on financial institution commitments. Firms that depend on equity are at 36%. rather than depending on commercial bank loans to address cash flow issues, these are more likely to succeed at 16%.

The European Investment Bank Banking in Africa survey, 2021, did not find that banks are more likely to lend to corporations than to small businesses, but bank loans to corporate clients had much longer tenors.

The majority of banks that responded said they served both market sectors. However, whereas almost two-thirds of banks (61%) reported a reasonably lengthy average maturity (more than two years) for corporate loans, only about 45% indicated similar average tenors for SME clients.

The major constraints limiting loan availability to corporates and small businesses are a lack of suitable collateral and a bad credit history, with a lack of bankable projects adding to the challenge for SMEs.

A lack of collateral was already a greater constraint for small businesses than for corporates, and given the general tendency of banks to favor larger clients and corporates in difficult times, SMEs are likely to be disproportionately affected by loan application rejections in the aftermath of the crisis.

Poor credit history was cited by 41% of responding banks as a key limitation on access to funding for SMEs, whereas only 12.3 percent cited it as a serious concern for corporates.

According to the World Bank, women own 58% of all MSMEs in Africa.

60% of the banks that responded to the European Investment Bank Banking survey 2021 said they had some sort of gender strategy in place.

Despite the fact that relatively few nations have implemented credit-scoring criteria or laws, certain credit bureaus have begun to offer credit rating and scoring services that provide extra information about MSMEs. SME lending might also be enhanced by efforts to improve insolvency resolution efficiency and by allowing banks to accept mobile assets as loan security.

Access to funding for African SMEs has also increased as a result of collateral framework reform and the creation of property laws, land registries, and computerized registries for pledging assets (including moveable assets) and receivables (collateral registries).

In North Africa the share of credit to GDP (which is often used as a figure of credit market development) is highest at 44 % and is lower in Southern Africa.

In Central Africa the financial markets are significantly less developed (e.g. credit to GDP is just at 13%). In Africa, credit growth was poor in 2020 (6.4% in nominal terms, with inflation around 15%).

The EIB Banking in Africa survey, 2021 suggests that most of the responding banks had an NPL ratio of at least 5%. NPLs account for at least 10% of the SME portfolio in approximately one-third of banks. Furthermore, 50% of the banks had at least 5% of their SME portfolio under moratorium, and 40% had at least 5% of SME loans under some type of restructuring.

Only around 31% of responding banks expect to relax their lending requirements in 2021, whereas more than 60% tightened them in 2020 and fewer than 20% anticipated relaxing them. 31 percent of responding banks want to tighten more in 2021. Overall, while banks show some optimism for lending in 2021, it appears that they are also contemplating a cautious approach, suggesting that the influence of the COVID-19 shock on lending may be somewhat enduring.

EIB action in LAMC 2020
In 2020, the European Investment Bank provided €516 million in finance in Latin America and the Caribbean, contributing to sustainable and equitable development as well as climate action. All EIB loans in the area were made to public sector borrowers, mostly national development banks and a few new partners.

The European Investment Bank focuses its public and private sector investments in Latina America and the Caribbean through:


 * Lending: medium and long-term loans with favorable terms, as well as alternative financing instruments such as guarantees, loan substitutes, or equity
 * Grants: for example, through the Latin America Investment Facility and the Caribbean Investment Facility, in partnership with the European Commission
 * Advising: project development assistance as well as assistance to public bodies in improving access to finance and facilitating investment.

The European Investment Bank has invested in Latin America since 1993, backing 140 projects in 14 countries for more than €10.8 billion. Since 1978, the EIB has been active in the Caribbean, providing around €2 billion for 220 projects.

In 2020 the European Investment Bank provided €462 million in Latin America, of which €278 million was due to the COVID-19 pandemic.

The EIB is collaborating with Peru's development bank COFIDE to assist small businesses affected by the virus outbreak's economic implications.

30% of a $100 million loan to COFIDE is dedicated to businesses affected by the coronavirus pandemic..

The European Investment Bank provided a $150 million loan to Nacional Financiera (NAFIN), one of Mexico's premier development banks, to help Mexican microenterprises dealing with the coronavirus pandemic meet their operating capital and investment needs.

A $60 million EIB loan will assist finance the development and renovation of water supply, wastewater, and storm water networks in urban and rural parts of Manab in Ecuador's Canton of Portoviejo. The Inter-American Development Bank (IADB), Spain's Fund for the Promotion of Development (FONPRODE), managed by the Spanish Agency for International Development and Cooperation (AECID), the European Union's Latin America Investment Facility (LAIF), and the Caribbean Investment Facility (CIF) will all contribute to the financing of the water supply.

Almost all current finance in the region comes through the Cotonou Agreement, a pact between the EU Member States and 78 African, Caribbean, and Pacific countries (ACP). Its goal is to relieve and eradicate poverty by contributing to sustainable development and allowing the ACP nations' progressive inclusion into the global economy.

In Barbados, the EIB provided a $12 million loan to the Ministry of Finance. This allowed the Barbados Water Authority (BWA) to rehabilitate the island's drinking water distribution network by improving efficiency, service quality, and resilience in order to mitigate the negative effects of climate change.

This investment will help protect Barbados' water supply from climate change and more frequent extreme weather.

The European Investment Bank investment will pay for the replacement of around 16 kilometers of aging pipelines, as well as the restoration of water reservoirs and pumping facilities. This will help to preserve the island's scarce water resources.

In 2020, the EIB partnered with Mexican development banks (NAFIN) and Brazilian development banks (Banco do Nordeste do Brasil, or BNB) to assist microenterprises affected by the coronavirus pandemic COVID-19. The loan to BNB promotes women's empowerment in business and helps to alleviate poverty.

The €200 million loan to BNB will assist in meeting the working capital and investment needs of Brazilian micro-enterprises affected by the COVID-19 breakout in northeast Brazil, with a focus on the most vulnerable and low-income borrowers in the region.

BNB will give micro-entrepreneurs with short-term loans of less than €1000 through its Crediamigo program, assisting them to modernise and innovate, mostly in metropolitan areas, with a special emphasis on funding for female-led firms.

This operation adheres to the Bank's 2X challenge criteria, which are in accordance with the EIB Group Strategy on Gender Equality and Women's Economic Empowerment. This operation adheres to the Bank's 2X challenge criteria, which are in accordance with the EIB Group Strategy on Gender Equality and Women's Economic Empowerment. Bank Ademi and Bank Adopem both adhere to the 2X challenger criteria, and assist women borrowers trhroughout Brazil.

Flagship publications

At present emission levels, the average global temperature will rise by 3.5 to 4˚C by the end of the century, which would be an unprecedented risk to human life.

To reach the 1.5°C target, we must emit less than 580 gigatonnes of CO2. That’s our carbon budget – forever. At the current rate of about 37 gigatonnes per year, we will have exhausted this by 2032..

In 2019, the European Investment Bank dedicated 31% of its financing to climate action.

In 2007, the European Investment Bank issued the Climate Awareness Bond – the world’s first green bond.

In November 2019, the Board of Directors of the European Investment Bank approved a 50% increase in the share of the investments allocated to climate action and environmental sustainability by 2025.

The European Investment Bank’s climate action and environmental sustainability support presents an expected volume of €30 billion per year.

The European Investment Bank’s business model aims to mobilise additional financing by the private sector for the projects it supports.

Over the decade leading up to 2030, the European Investment Bank aims to support climate action and environmental sustainability investments worth €1 trillion.

The European Investment Bank commits to align all its financing activities with the goals of the Paris Agreement by the end of 2020.

In 2018, the European Union invested EUR 158 billion in climate change mitigation, which represents 1.2% of GDP. This is slightly over a third of China’s figure (3.3% of GDP) and marginally less than the United States’ performance.

For the fifth year in a row, the EU’s real gross fixed capital formation increased faster than real GDP in 2018.

Investment growth per year in the European Union fell from 3.7% to 2.3% in 2018.

In 2017, 24.5 million small businesses in the European Union accounted for 99.8% of all non-financial enterprises, involved employment for around 95 million people, coming to 66.6% of total employment, and generated 56.8% of total added value. In total, €4161 billion.

After hitting a 20-year low in 2016 (2.7% of GDP), general government investment in the European Union increased in 2017 (2.8%) and 2018 (2.9%).

Private equity firms located in Europe raised EUR 97 billion in 2018, which demonstrates a 1% increase compared to the previous year.

In 2018, the EIB supported small businesses and mid-caps with 36% of its new lending.

In 2019, the European Investment Bank conducted a survey finding that 5% of firms in the EU can be regarded as financially constrained in terms of external finance, which is equal to the proportion stated in the same survey in 2018. In 2019, 16% of firms in the EU were using their own financial resources or seeking internal funds. 20% of firms across the EU stated that they were highly profitable.

The same survey found that, on average, EU businesses spent 48% on replacement with ranging numbers from 45% in the manufacturing sector to 54% in the infrastructure sector.

Almost half of EU firms 48% that participated in the survey stated that they have partially implemented at least one digital technology, while a further 11% fully implemented digital advancement. 79% of EU firms considered their investment activities over the period of 2017 - 2019 to be in line with their needs, similarly to findings in the 2017 and 2018 editions of the survey. 15% of firms believed they invested too little, while 3% reported investing too much.

The EIB Investment Survey (EIBIS) 2019, in line with EIBIS 2017 and EIBIS 2018, stated that the availability of skilled staff is the most frequently cited long-term barrier to investment (77%).