EU ministers promote ‘investment’ but options unclear

MILAN, Sept 14 (AFP) :  EU ministers said Saturday investment was key to bringing the European economy out of the doldrums, but options were limited with funding and spending issues still unresolved.
"There is a dearth of investment in Europe and this is the reason for weak growth," said Italian Finance Minister Pier Carlo Padoan, who headed a meeting of European Union finance ministers in Milan.
After years of a German-led push to slash debt-plagued government budgets, the possible return to recession in the EU has sparked calls for more spending to counteract the anti-growth effects of austerity.
"We managed to create a unified atmosphere. Things are not black and white where you have to choose between investment and fiscal consolidation," said European Economic Affairs Commissioner Jyrki Katainen, usually a hawk on the dangers of government over-spending.
"If you spend public money wisely. . . (in research and innovation) it creates a lot of welfare for citizens," he said.
The situation is increasingly worrying, officials said, with ECB Vice President Vitor Constancio warning that investment and growth levels in the EU were still behind 2007, pre-crisis levels.
"In the 1930s, it took quicker to get back to 1930 growth rate," Constancio said, adding that it was the urgency of the situation that pushed the European Central Bank to cut its rate and announce a new bond-buying programme earlier in the week.
Several options for a Europe-wide boost in investment are on the table, none yet fully confirmed or with financing in place.