By Kevin Akor
BRUSSELS (chatnewstv.com) — The European Union’s Council and Parliament have reached a political agreement to amend rules governing the bloc’s main external investment guarantee, a move aimed at making EU development and external action funding more flexible and effective amid rising global competition.
The deal, announced Monday, introduces targeted changes to the regulation establishing the Neighbourhood, Development and International Cooperation Instrument – Global Europe, better known as NDICI. The amendments focus on strengthening the External Action Guarantee, the EU’s primary tool for reducing financial risk and mobilizing public and private investment outside the union.
EU officials said the agreement will allow existing resources to be used more strategically, particularly through the European Fund for Sustainable Development Plus, or EFSD+, while preserving the framework’s objectives, safeguards and budgetary controls.
“This agreement enhances the efficiency of the EU’s external investment tools without changing their mandate and objectives,” said Constantinos Kombos, Cyprus’ foreign minister, whose country holds the rotating EU Council presidency. “It allows us to mobilize more investment where it is most needed, while fully respecting the EU’s values, policy objectives and budgetary safeguards.”
Under the deal, surplus funds from the earlier EFSD guarantee can be redirected to provision the EFSD+ budgetary guarantee, increasing overall guarantee capacity within the current seven-year EU budget. The agreement also optimizes risk coverage by allowing the EU guarantee under the European Investment Bank’s dedicated investment window to support a greater number of projects.
Officials said the changes will simplify procedures for implementing partners, including lighter reporting requirements for blending and guarantee operations, to speed up project delivery and attract private capital at scale. Safeguards linked to NDICI principles, including special consideration for fragile states and least developed countries, remain in place.
The External Action Guarantee is a core pillar of the EU’s Global Gateway strategy and can cover investments backed by EU funds of up to 53.4 billion euros. It is designed to act as a financial buffer, leveraging private investment in sectors such as climate action, infrastructure and post-conflict reconstruction.
Through the guarantee, the EU has supported projects ranging from green hydrogen initiatives in Namibia and submarine cable links between Europe, Africa and Asia to vaccine production in Africa and carbon absorption programs in the Amazon.
The European Commission proposed the targeted amendments in May 2025, citing strong demand for EFSD+ operations and shifting geopolitical priorities.
The provisional agreement must now be formally endorsed by both the Council and the European Parliament before it can enter into force.
