PRESS RELEASE BY THE MINISTRY FOR TRANSPORT AND INFRASTRUCTURE: Vision and perspectives on the opportunities to increase investment in transport in cohesion Member States

Minister for Transport and Infrastructure Joe Mizzi said that Malta, in taking up its role as Presidency of the EU Council earlier this year, is firmly committed to facilitating new opportunities for transport financing in order to meet Europe’s mobility requirements safely, sustainably and efficiently.

During his keynote speech at the Regional Transport Investment Conference which is being held in Sofia, Bulgaria, Minister Mizzi said that Malta has advocated the promotion of different innovative financing solutions that could be deployed to facilitate the timely realisation of Europe’s TEN-T infrastructure network.

“We are also firmly committed to exploring new innovative financing solutions, such as the Cleaner Transport Facility, a facility launched during our Trio Programme by the Dutch Presidency, which focuses on life-cycle cost models that involve risk-sharing financial instruments, also leveraging private sector funds, a facility aimed to develop, demonstrate and promote cleaner modes of transport,” he added.

“As a cohesion country, I believe we have a very clear understanding of the main challenges currently being faced by many cohesion countries in this region. There are difficulties being faced in securing the necessary levels of long-term financial investment in the sector, in particular the challenges being faced in mobilising the private sector to finance infrastructure and mobility projects. Under the Maltese Presidency we are building upon the sterling work carried out under the Dutch and Slovak Presidencies to enhance the sustainability and competitiveness of the EU transport sector. And I can assure you that we will work tirelessly towards reinforcing the functioning of the internal market and towards achieving the objectives of the Investment Plan for Europe”, Minister Mizzi said.

“As representatives of cohesion countries, we are most fortunate that Euros 63 billion, or 7% of the total EU Multiannual Financial Framework, has been allocated to the Cohesion Fund for the period 2014-2020”, the Minister stated.

The Connecting Europe Facility is a fundamental instrument designed to promote growth, jobs and competitiveness through targeted infrastructure investment at a European level. Over the last three years, some Euros 24 billion of EU grants in the transport sector will have been made available to Member States under the CEF, including more than Euros 11 billion set aside specifically for cohesion member states. These grants are vital to support to the building of new transport infrastructure or for rehabilitating existing infrastructure to remove traffic bottlenecks or complete missing links in our networks.

The Minister added that, however, funding from grants alone will not nearly be enough to cover the cost of completing the TEN-T core network by 2030, which will cost an estimated Euros 1.5 trillion. “So we need to be realistic about how we will finance our transport requirements and how we will complete the TEN-T network. As infrastructure deployment takes significant time to plan, secure financing and deploy, the key time period to start exploring and deciding upon the appropriate financial mechanisms is now.”

Minister Mizzi said that one of the remaining tools available for Governments to support infrastructural development are the vast financial resources locked up in the private sector. The private sector is thirsting for viable, suitable projects to be involved in and to provide expertise for, but there are some challenges when it comes to their participation. The private sector necessarily needs to match risk with reward, based on its appetite for risk; on the other hand however, governments also need to ensure that the reward provided is commensurate with the results achieved and that citizens receive value for money.

He continued by saying that the new financing tools available through the European Fund for Strategic Investments are definitely interesting; however, to be successful, the challenges that remain need to be addressed.

“We need to have a vision to address these challenges in order to boost transport infrastructure financing and facilitate the transition of Europe’s transport system into an efficient, clean, integrated and safe network of services and infrastructure”, the Minister concluded.

Source: Government of Malta