The Spanish government aims to build 15,000 homes per year using resources from the new sovereign wealth fund.

MadridThe sovereign wealth fund announced by Pedro Sánchez a month ago will be used to build 15,000 affordable homes per year. The Spanish Prime Minister made this promise on Monday during the fund's official launch. €10.5 billion investment lever from European funds which aims to mobilize up to €120 billion in public and private funds. Of that amount, €23 billion will be allocated to building these properties, as Sánchez stated, although he did not specify what portion will be public funds. "We want to roll out the red carpet for private investors to build housing. This is our commitment: the largest volume of public and private financing under favorable conditions," said the Spanish president.

The fund, named España Crece (Spain Grows), was scheduled to be publicly presented a month ago, but the event was suspended, along with the entire institutional agenda, due to the tragic train accident in Adamuz (Córdoba). The venue chosen this Monday to finally launch this investment tool was the Madrid College of Architects, where representatives from some of the main companies in which the State has a stake, such as Indra and Correos (the Spanish postal service), attended, as well as members of sectoral employers' associations.

Sánchez was accompanied by almost all the Socialist ministers, including the Minister of Economy, Carlos Cuerpo, and the Minister of Housing, Isabel Rodríguez, who participated in the event. "This [investment] tool seeks to support companies [...]. What we want is to consolidate the current virtuous cycle of the economy so that companies grow, innovate, pay higher wages, and become magnets for talent," Cuerpo stated.

The Spanish government has presented this sovereign wealth fund as a tool to provide "continuity" to European funds, a windfall that ends next August, as Sánchez reminded everyone. "[European funds] have been the starting point of a transformation that cannot end [...] We must put resources at the service of prosperity and strategic autonomy," the Spanish Prime Minister argued.

While the fine print of the fund is still pending, it is known that the Official Credit Institute (ICO) will manage it. The goal is to mobilize up to €120 billion through private debt and public and international state investments. The idea, therefore, is to "co-invest" with the private sector through loans, guarantees, or equity instruments, prioritizing nine key sectors for improving economic productivity: housing, energy, digitalization, AI, reindustrialization, the circular economy, infrastructure, water and sanitation, and security. Sánchez wanted to start the week with an economic agenda. After the presentation of the sovereign wealth fund, the Spanish Prime Minister presided over the signing of the minimum wage increase to €1,221 per month, agreed upon with the major unions, CCOO and UGT, but without the employers' association.