EU Boosting Investment in Critical Technologies
The European Commission created a groundbreaking initiative called the Strategic Technology Platform for Europe (STEP). This platform aims to achieve several key objectives that are vital for our continent’s future prosperity.
First and foremost, STEP seeks to boost investment in critical technologies within Europe. By doing so, we can reduce our dependence on other economies and safeguard ourselves against the effects of high inflation, labor shortages, supply chain disruptions, rising interest rates, and increasing energy and input costs.
To accomplish this ambitious goal, STEP will be a dedicated funding platform focused on supporting innovative technological solutions. This new initiative replaces the European Sovereign Fund and builds upon existing EU instruments, such as InvestEU, Innovation Fund, Horizon Europe, EU4Health, Digital Europe, the European Defence Fund, and the Resilience and Recovery Mechanism, as well as Cohesion Policy funds.
Sector Focus: Deep Tech, Cleantech, and Biotech
The European Commission has recognized the importance of various sectors in maintaining European leadership, and STEP will primarily direct financial support towards deep tech and digital technology, clean technologies, and biotechnology. These sectors are crucial for addressing climate change, sustainable energy, and public health challenges.
Under the proposal, an additional €10 billion will be allocated to specific programs to enhance investment capacity and promote the objectives of STEP. For instance, €3 billion will be assigned to InvestEU, which is expected to result in an outcome of €75 billion after considering the provisioning rate and multiplier effect. Furthermore, €500 million will be allocated to Horizon Europe, complemented by €2.13 billion of reallocation and use of decommitted amounts, leading to an outcome of €13 billion. Additionally, €5 billion will be directed to the Innovation Fund, with an expected outcome of €20 billion, and €1.5 billion to the European Defence Fund, potentially resulting in investments of up to €2 billion. Overall, the total amount of new investments through STEP could reach an impressive €160 billion, according to estimates by the European Commission.
Unleashing Innovation: Funding Opportunities for Different Business Stages
STEP’s focus will be on supporting companies at different stages of business development within the deep tech, cleantech, and biotech sectors. This includes equity support for unbankable SMEs and startups, as well as unbankable small mid-caps through the European Innovation Council under Horizon Europe. Additionally, there will be equity and debt support for EU companies under InvestEU. Grants will be provided for clean technology projects, including large-scale projects, under the Innovation Fund, and for deep and digital technology projects with defense applications under the European Defence Fund. Furthermore, any type of support will be available to enterprises active in these sectors through Cohesion Policy funds and the Recovery and Resilience Mechanism.
To further incentivize exceptional projects, the Commission proposes the introduction of a Sovereignty Label. This label will be awarded to projects that obtain a high score during the selection process of a competitive procedure. Even if a high-quality project cannot receive funding under its applied program due to budgetary constraints, the Sovereignty Label will grant it privileged and simplified access to other funding sources under STEP.
In conclusion, STEP could play a crucial role in supporting investments in companies that contribute to preserving Europe’s edge in critical technologies.
Let us embrace these funding opportunities and work together to advance our region’s technological leadership and sustainable development.
