Pan-continent broadband rollout plan is designed to pay back taxpayers for the bailout of the financial sector in the past three years, says the Guardian
The European Commission (EC) is planning an investment of around €9.2bn (£8bn) in a roll-out of high-speed broadband networks and services across the EU, targeted to attract more private investments and create new jobs.
The broadband network plan is partly aimed at increasing further investment in rural broadband. As a part of the plan, around €50bn will be invested in digital, energy and transport infrastructure. The EU hopes that the plan will also help to create a single market for digital public services.
EU digital agenda commissioner Neelie Kroes said the initiative would improve the credit rating of infrastructure projects and so ease pressure on financing, according to the Guardian.
The EC estimates that the roll-out of high-speed broadband networks in Germany alone would create nearly one million jobs between now and 2020, while the fibre-to-the-home network in France could generate 360,000 jobs a year, said the BBC.
The EC has already charted an ambitious broadband plan for the EU. Among its broadband targets is to make available at least 30 megabits per second (Mbps) Internet speeds for all households by 2020, and 100Mbps speeds for half the population of the entire continent.
The BBC said that the initiative will be proposed by the EU’s executive body on Wednesday.
The broadband rollout plan, which is likely to invested between 2014 and 2020, would have to be approved by the European Parliament and the EU’s Council of Ministers, said the BBC.
It quoted EU sources saying:"Europe needs these fast broadband networks to allow its economy to become more competitive in the future, and so create more jobs and prosperity."
"This money would stimulate much greater investment of private and other public money. Each euro [invested by the Commission] would give rise to a further six to 15 euros more."
The European Investment Bank (EIB) is expected to contribute to the funding. The Guardian said that the initiative "are designed to pay back taxpayers for the aid and guarantees of €4.6tn given to the financial sector in the past three years." The paper added "Despite this taxpayer funded support, venture capital investments in Europe slumped last year to just €3bn."
EIB president Philippe Maystadt told the Guardian: "Infrastructure finance in Europe has suffered since the financial crisis and banks face new constraints on long term lending. Project bonds could be a way to attract capital from other investors, such as pension funds and insurance companies, and be a useful addition to traditional financing options."
The EC hopes its broadband plan would immediately create hundreds of thousands of jobs in the construction and telecoms equipment industries.