Denmark's Export and Investment Fund is amongst one of the first financial institutions in Denmark that is given the opportunity to help Danish businesses on their journey towards a green transition with access to funding through preferential terms backed by the European Investment Fund.
The projects, co-financed with the European Investment Fund, will be within either renewable energy, energy savings or resource efficiency.
The arrangement is backed by the European Union's new InvestEU programme, and the European Investment Fund and Denmark's Export and Investment Fund have signed an agreement to guarantee around DKK 229 million (EUR 30.9 million), enabling the Danish state fund the possibility of approving loans to Danish businesses of up to 575 million DKK.
The Danish sovereign investment fund as the front runner
The sustainability guarantee will support new financing for small and medium-sized enterprises to contribute to Europe’s green transition.
Denmark’s Export and Investment Fund is the sovereign investment fund of Denmark, and the result of a merger of EKF Denmark’s Export Credit Agency (EKF), growth fund Vaekstfonden and the Danish Green Investment Fund. Through a single point of contact, Danish companies can now gain access to state financed risk capital.
One of the purposes of the state loan fund is the co-financing of economically viable project, and the fund is one of the first financial institutions in Denmark to sign the European Commission backed InvestEU agreement. The loans will be channelled towards projects that are within the areas of energy saving, renewable energy sources and resource efficiency seeking to bridge the gap between the traditional bank financing and equity capital.
The green transition requires risk capital
Morten Bødskov, Danish Minister for Industry, Business and Financial Affairs:
“If we are to succeed with the green transition, we need to ensure that risk capital is available to achieve our ambitious green goals. InvestEU plays a central role in the green transition across the entire European Union by financing green and sustainable projects across member nations. With the establishment of Denmark’s Export and Investment Fund, we now have an ambitious player in Denmark. The agreement with the European Investment Fund gives it even more firepower to fund the green transition of Danish businesses.”
Peder Lundquist, CEO of Denmark's Export and Investment Fund:
"The green transition requires long term risk capital, because the solutions needed to cross the finish line require large investments. Global competition means that we, as the state loan fund, play a crucial part in the task of developing and commercializing new technologies and enabling a green transition for the entire business community. We are therefore happy to have the opportunity to cooperate with a global entity such as the European Investment Fund, so that we can help make way for the green businesses that are going to make Denmark richer and the world greener."
Marjut Falkstedt, Chief Executive of European Investment Fund:
“We are very happy to be partnering with the Denmark's Export and Investment Fund, a leader in green financing. This agreement, which was made possible by the InvestEU programme, will channel financing to Danish businesses to help them on their path to a more sustainable, greener future. Public entities need to make every effort to support European businesses in their green transformation and this transaction does precisely that.”
European Commissioner for the Economy, Paolo Gentiloni:
“InvestEU is playing an important role across Europe in helping small and medium-sized businesses gain access to the finance they need to innovate, expand and create jobs. This investment can also help them green their business, thereby making a major contribution to our transition to a low-carbon economy. I am delighted that, thanks to this agreement, more Danish businesses will receive the support they need to fulfil their full potential.”
The European Investment Fund is part of the European Investment Bank Group. Its central mission is to support Europe’s small and medium-sized enterprises (SMEs) by helping them access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that specifically target this market segment. In this role, the EIF furthers key EU policy objectives such as competitiveness and growth, innovation and digitalisation, social impact, skills and human capital, climate action and environmental sustainability, and more.
The InvestEU programme provides the European Union with crucial long-term financing by mobilising significant public and private funds to support a sustainable recovery. It helps generate additional investments in line with key European priorities, such as the European Green Deal, the digital transition and support for SMEs. The InvestEU programme brings together a multitude of EU financial tools to support investment by making project financing simpler, more efficient and more flexible. The programme has three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented via various financial partners. They will invest in projects by using the EU budget guarantee of €26.2 billion to mobilise at least €372 billion in additional investments.
Denmark's Export and Investment Fund
Communications Advisor, Sara Kleist