EC Green Paper on Long Term Finance – an NAPF response - June 2013
The NAPF has responded to a European CommissionGreen Paper on long-term financing of the European economy.
The Green Paper examines how the EC can promote investment in sectors such as infrastructure, digital, climate change technology and ‘social infrastructure’ that need investment over the long-term.
The NAPF welcomes the Green Paper, particularly its strong emphasis on strengthening the future prospects of the EU economy. NAPF members have liabilities stretching over 50 years or more and need long-term assets to match them. More specifically, they are looking for long-term assets that deliver reasonably reliable and predictable income streams with manageable and acceptable levels of risk.
The NAPF’s response argues that the most effective contribution the EU could make to creating a stronger environment for long-term investment would be to ensure that productive long-term investment is not penalised by EU legislation. For example, there is a concern that putting light risk weights on short-dated bonds and heavier weights on equity, property and private equity could impede investment in the long-term – not least because pension funds are heavily invested in long-dated fixed income products and equities
The NAPF’s response can be downloaded by clicking on the link below.