EIB Investment Report 2024/2025

The "EIB Investment Report 2024/2025" is a publication by the European Investment Bank (EIB), authored by a team led by Debora Revoltella from the EIB Economics Department. This report provides an in-depth analysis of investment trends and economic drivers across Europe, focusing on the challenges and opportunities in achieving sustainable growth, particularly in light of the green transition and market integration.

The report outlines the critical need for increased public and corporate investment in a challenging economic environment, emphasizing that government investment has grown significantly in recent years. In 2023, government investment in the European Union surged by 15%, driven by extensive funding from the Recovery and Resilience Facility (RRF) and efforts to address the energy crisis. This rise reflects a strategic response to bolster economic resilience and support the transition to sustainable practices.

Sustainable housing is a pivotal focus within the report, highlighting the pressing need for affordable housing solutions across Europe. The EIB estimates that 2.25 million additional housing units will be required by 2025, which is 50% greater than the current housing starts. This gap of 925,000 units underscores the urgency of addressing housing shortages, particularly in urban areas where demand is growing.

The report identifies substantial investment needs to facilitate the EU's climate goals. The European Commission estimates that achieving the Fit-for-55 objectives will require an additional annual investment of approximately EUR 506 billion from 2023 to 2030, specifically targeting clean energy supply and energy efficiency in residential, industrial, and transport sectors. This funding is essential for transitioning to greener technologies and ensuring sustainable living conditions.

Public investment has proven to be a significant driver of overall investment growth, accounting for nearly one-third of GDP growth since the pandemic. The report emphasizes that coordinated policies at the EU level, including the RRF and structural funds, have been instrumental in facilitating investments in essential infrastructure and housing. However, the reinstatement of EU fiscal rules by 2026 poses challenges for maintaining this momentum.

The report discusses the broader implications of investment in sustainable housing and infrastructure beyond mere economic growth. It emphasizes the importance of social inclusion, indicating that improving access to affordable housing can lead to increased labor force participation, particularly among women and marginalized groups. This, in turn, could potentially enhance EU GDP by 4% if female labor force participation reaches the highest EU standards.

In conclusion, the EIB Investment Report 2024/2025 provides crucial insights into the current state of investment in the EU, with a significant focus on sustainable housing and the green transition. The outlined investment needs and growth opportunities highlight the importance of targeted public policies and coordinated efforts to effectively channel resources toward achieving sustainability goals while fostering economic resilience across Europe.