14
The cable industry
can receive a boost
from Europe
The Commission plans to unleash up to €315 billion
in infrastructure spending to combine with the impact
of the ECB action and the strong dollar.
As 2015 unfolds, consensus is growing
among experts and industry watchers that it
could be a positive year for European cable
manufacturers, with growth expected to
pick up and accelerate onwards, particularly
in the high added-value segment of telecom
and submarine cable businesses. There are
general factors behind these expectations,
such as the quantitative easing (QE)
launched in mid-March by the European
Central Bank, which is expected to boost the
economy by improving credit conditions,
and the continuous depreciation of the
euro, which is a side effect of the QE and
makes European-made capital goods, such
as cables, more competitive in international
markets.
GLOBAL SCENARIO
An additional major boost to the cable
industry is expected to come from the
Juncker plan, named after the former prime
minister of Luxembourg, who became the
European
Commission’s
President
last
November, with his idea for a European
Fund for Strategic Investments (EFSI).
Mr Juncker believes that the fund could
mobilise up to €315bn, much of it from
private sector finance, to increase jobs
and growth by investing in new transport,
energy
and
information
technology
projects. The plan aims at assembling a
starting pot of €21bn from a combination
of funds available at the Commission and
the European Investment Bank, which can
be leveraged by a factor of 15 through a
mixture of member state contributions,
bonds and private bank debt. The resulting
cash will be spent on new roads, ports,
energy facilities, green technology and IT
projects, many of which were put on hold
due to the economic crisis.
New transport, energy
and IT projects
