The European Commission is exploring how to use its development budget to incentivize private investment in health and education around the world, triggering concern from aid NGOs.
During a webinar with more than 300 business representatives last month — a recording of which was obtained by Devex — a commission official said Brussels is looking at “human development” as a new area for its budget guarantees. Launched in 2017 and set to be expanded in the next seven years, the guarantees allow the commission to allocate billions of euros to mostly European development banks to partially cover the banks’ potential losses on risky projects in investment-starved countries.
The first batch of guarantees was steered by the commission into five areas: sustainable energy and connectivity; micro, small, and medium-sized enterprises; sustainable agriculture; sustainable cities; and digital solutions for development.