Supporting Greentech clusters and building a more conducive investment environment are the policy measures needed to develop Greentech in the EU according to a capstone project on ”The European Greentech Ecosystem – the role of corporate financial constraints” led by LSE Masters students coordinated by the European Investment fund (EIF) and presented at the EIB on 24 March 2022.
Greentech is defined as “innovations that contribute to economic and environmental sustainability” and is particularly important for the EU if it wants to reach carbon neutrality by 2050.
After mapping the Greentech ecosystem, the five students studied the impact of access to finance in the EU compared to the US and China. While the EU also has well developed clusters, they need to be strengthened and developed for instance by leveraging regional specialisations through knowledge sharing and productivity task forces.
At the same time, the students say, it is important to build up investor presence in countries that are currently lagging in Greentech investment, facilitate access to Venture Capital/Private Equity as a substitute to debt and increase capacity for scale up funding, without crowding out extra EU financing.
This is the seventh capstone project conducted by the EIF with students from the LSE’s Master of Public Administration.