InvestEU Reform: Simplification, Guarantee Expansion and Strategic Relevance

The political agreement reached on 23 September 2025 between the Council and the European Parliament marks a significant recalibration of the InvestEU framework, designed to strengthen competitiveness while extending the programme’s reach to strategic domains such as defence industrial policy and military mobility. For years, InvestEU has functioned as the Union’s flagship investment platform, blending public guarantees with private capital to mobilise large-scale financing. The new deal, embedded in the Omnibus II package, seeks to eliminate administrative complexity and unlock greater investment potential. It does so by raising the EU guarantee, aligning InvestEU with the competitiveness agenda laid out in the Draghi and Letta reports, and embedding support for critical sectors, including clean industry and defence. This reflects a wider recognition that competitiveness, security and industrial policy are now inseparable in Europe’s financial governance.