The head of the European Investment Bank says that private investors are discouraged from putting money into major European Union infrastructure projects because of red tape and lack of budgetary reform.
Werner Hoyer said Monday that when he asks potential investors what is scaring them off "they come with regulation, and they come with bureaucracy."
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The EIB is providing seed capital for the EU's new 315 billion euro ($356 billion) investment fund, which will provide loans for higher risk strategic projects like energy networks or broadband Internet. Hoyer said seed capital won't be enough if the plans are "not accompanied by ambitious reform processes," notably budget reforms in the EU and its member countries.
The fund is set for official launch in September.