Dáil Éireann Debate, Tuesday - 14 July 2015
421. Deputy Paul J. Connaughton asked the Minister for Agriculture, Food and the Marine the timeline for the roll-out of financial instruments in Ireland, following his participation, with An Taoiseach, the European Union Commissioner for Agriculture and Rural Development, Mr. Phil Hogan, and the Vice-President of the European Investment Bank, Mr. Wilhelm Molterer (details supplied), in the Financial Instrument Compass event on 23 June 2015. [29225/15]
View answerIt is open to Member States to implement financial instruments via their Rural Development Programmes. Financial instruments can take the form of loans, guarantee funds or equity investments. The funding for any such financial instruments would have to draw on our existing RDP allocation of European Agricultural Fund for Rural Development funding as well as National Exchequer funding. It is also possible to incorporate funding from other sources in rolling out such instruments.
In our RDP, we have made a commitment to examining the potential for the use of financial instruments. However, the inclusion of financial instruments by way of a modification to the RDP is required by EU regulation to be based on an ex ante evaluation which must assess:
- The existence of a market failure;
- The potential for added value;
- The resources required to implement a proposed financial instrument; and
- The proposed strategic approach to financial instruments.
Accordingly, I have asked officials in my Department to engage with the European Commission, the EIB and other stakeholders in order to identify areas where financial instruments could be implemented to best strategic effect, and to explore the practical steps which are required in order to implement financial instruments. Any such financial instruments are required by EU regulation to be structured on a clear investment strategy which identifies real market failures and economic needs.
In addition to this, my Department has been exploring new and more competitive sources of funding and will continue to do so in the context of evolving market requirements. For example, the Strategic Banking Corporation of Ireland, which includes the European Investment Bank as one of its funding partners, has recently announced a new 'Agriculture Investment Loans' product. This credit is available at favourable terms for investments by agricultural SMEs involved in primary agricultural production, the processing of agricultural products or the marketing of agricultural products.
