(MENAFN - Qatar News Agency) The European Union agreed Tuesday on a plan to raise capital for infrastructure through project bonds, while Germany continued to resist the more ambitious idea of joint issuance of Eurozone debt - so-called Eurobonds.
The developments came on the eve of a summit in Brussels on economic growth, which will mark French President Francois Hollande's debut on the EU scene, and set the stage for a potential clash between his push for economic growth and German demands for fiscal prudence.
The deal on project bonds was hailed as an "important milestone for European infrastructure, competitiveness and growth," according to a Twitter message by the Danish Presidency of the EU.
Under the scheme - first aired in 2010 - 230 million euros (293 million dollars) would be earmarked from the EU budget to cover some of the risk that the European Investment Bank (EIB) - the bloc's lending arm - takes when providing loans for infrastructure projects.
The joint EU-EIB guarantees would lower the risk profile of the projects, making them more attractive to banks, pension funds and hedge funds looking for a safe investment - and lightening the load for governments hard-pressed to subsidize public works.