STRASBOURG, France
The European Parliament on Wednesday approved the EU Budget for 2015, as presented by the European Commission.
The budget was backed by 443 votes, with 250 voting against, and with 7 abstentions.
The €315 billion ($392.2 billion) investment plan presented by EU Commission chief Jean-Claude Juncker and his commission has been widely criticized, as only €21 billion ($26.1 billion) will actually come from EU funds.
Presenting the budget last month, Juncker explained that the European Fund for Strategic Investment was based on reallocating funds and luring private investors into the scheme, instead of taking on new debt in an effort to revive the struggling EU economy.
He explained that the three-year scheme, starting in June 2015, would use public "seed money" of €21 billion, with the EU financing €16 billion ($19.9 billion) from its budget, and with the European Investment Bank providing the remaining €5 billion ($6.2 billion).
It is understood that "seed money" would come in the form of guarantees to be used to raise private funding for investment in high-risk projects valued at the estimated €315 billion.
However, his plan was not welcomed by lawmakers in Strasbourg.
'Empty words'
Dimitrios Papadimoulis, a Greek member of parliament of the left-wing Europe United Left - Nordic United Left group, said Juncker's scheme did not provide "fresh money."
He told Juncker: "The package you presented is just empty words. €16 billion comes from the EU budget and €5 billion from the EIB. There is not one euro of fresh money in there, and you promised that you are going to create some kind of leverage effect multiplying funds by 15. In these times of stagnation and recession in the Eurozone, there is no economist in the world that would believe this."
Gerolf Annemans of the Vlaams Belang party said that the investment package was "basically a recycling, a relabeling. This is a useless watering can; hocus pocus, abracadabra, and just monopoly money."
Carsten Brzeski, a senior economist at the banking group ING, told the Danish news website "business.dk" ahead of the presentation: "This looks like financial abracadabra. I am very skeptical about whether it is possible to multiply the fund 15 times through private investments. We have heard about similar plans that have not succeeded."
"It is a shame, because the idea of an investment plan with focus on infrastructure is a good idea, only member countries need to put serious money in it," he added.
France has said the EU must inject up to €80 billion ($99.6 billion) of "real money" into the struggling European economy, and warned that the investment plan risked failure if enough hard cash was not used to stimulate demand.
European Investment Bank supports plan
Socialist group leader and Italian deputy Gianni Pitella said that his group welcomed the plan as a "first step," but added there was "a long way to go" in spurring investment in Europe.
Investment in Europe was about 15 percent to 20 percent behind pre-financial crisis investment levels, according to European Investment Bank statistics.
But European Investment Bank President Werner Hoyer said he supported the plan.
"I believe that the plan, while not a silver bullet, can make a real difference to investment in Europe," he said.
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