European Commission President Jean-Claude Juncker has presented his 21 billion euro reserve, an emergency fund created by the Commission and the European Investment Bank. This would enable the European Central Bank to fund loans three times the size. Private investors are being expected to put forward the lions’ share of the money,

The idea is part of spending some 300 billion euros to kickstart the eurozone economy.

The Fund for Strategic Investments will focus on strategic lending, ensuring liquidity for key industries.

“Juncker’s instruments were quite limited, so what he has done now I think is probably the only feasible way of achieving the figure of 300 billion euros. Whether that will be achieved in reality remains to be seen,” says the Chief Executive of the European Policy Centre Fabian Zuleeg.

The success of such schemes in the past has been linked to the use of public money, so will this plan be hindered by the lack of taxpayers sharing the risk?

“Public guarantees can of course help to give incentives for investments because the risk in a way is shifted from the private towards the public sector – but at the same time this means, of course, risks for the taxpayer. So it is not necessarily the best strategy, it depends very heavily on exactly how the guarantees are designed,” says the director of the Breugel thinktank Guntram Wolff.

For Europe it appears there are risks if it does not try to stimulate growth, and risks if it does. For now the choice has shifted slightly from trimming spending to investing for growth, but if this strategy does not work there are precious few instruments left to try.