Italy keen to push European project bonds

Pier Carlo Padoan at the Lisbon Council, 20 April 2011 [Photo: Lisbon Council / Flickr]

Pier Carlo Padoan at the Lisbon Council. 20 April, 2011 [Lisbon Council / Flickr]

Italy, which currently holds the rotating presidency of the European Union, is keen to re-launch debate on long-term “project bonds” to finance infrastructure projects, Finance Minister Pier Carlo Padoan told French business daily Les Echos.

“In all European countries, we have seen a constant decline in [infrastructure] investment, both in the public and private sector. We must reverse that trend,” Padoan said in an interview published on Monday (7 July).

Padoan also said Rome could back moves to create an EU-wide unemployment insurance mechanism as a way of bolstering European monetary union, saying such a measure could help support the economy at the bottom of the downturn.

However he played down any prospect of new talks on so-called “eurobonds” instruments intended to mutualise debt at European-level, saying “from a political point of view I don’t think we are there at the moment”.

A large offshore submarine gas storage facility in Spain was the first in Europe to issue ‘project bonds’ for a total of €1.4 billion, three years after the idea was launched by European Commission President José Manuel Barroso in 2010.

However, the project named Castor, was halted last November after more than 200 minor earthquakes were detected near the area.

>> Read: First EU ‘project bond’ in Spain halted

Two other ‘project bonds’ were issued since then, with funding from the EU or the European Investment Bank (EIB): the Greater Gabbard Offshore Transmission network project in the United Kingdom and the A11 motorway in Belgium.

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