Social investment is the key to economic stability in Europe, writes Euronews.

Here’s why.

By Alexandra Leistner, Euronews

Turning off the news these days can feel like a necessary pause from the chaos we live in: A war in Europe and another on its doorstep, a political shift towards defence spending, as well as nationalism and protectionism, and the global order being torn apart.

These fragile times bring economic instability, and societies are feeling the strain of tight public budgets. While high petrol prices and supermarket bills affect most people, it is the most vulnerable who are hit hardest by energy shocks, the rising cost of living and slowing economic activity.

In moments like these, our world can feel like a fabric coming apart at the seams, with no needle in sight. And when the social fabric frays, people’s welfare and their community’s cohesion are often among the earliest casualties, forcing governments to reallocate already squeezed resources. So the question is, who can still invest in Europe’s social fabric and what return can that investment bring?

How to strengthen a social fabric

Imagine living in a city you love, only to see your rent rising beyond what you can afford. For Estel and her family from Barcelona, a housing cooperative offered a way to stay. Today they do not own their flat, but they have the right to use it indefinitely. By paying a modest monthly fee to the cooperative, their housing remains outside the pressures of the real estate market, more secure and more affordable.

The institution that made this project possible is the Council of Europe Development Bank (CEB). For generations it has been skilfully working the European social needle, operating between social mandate and financial discipline.

Its role has been shaped by the region’s periods of calm and crisis. “Europe is once again operating in a context of fracture,” says Carlo Monticelli, Governor of the CEB. Speaking at the Bank’s 70th anniversary in Warsaw, he drew a parallel between today’s unsettled environment and the recovery period following the Second World War, when the institution was founded.

Established by eight Council of Europe member states in 1956 to tackle post‑war social challenges - as a Resettlement Fund for displaced populations - the CEB translates the Council’s values, notably those upholding the social rights of citizens, into reality through its many investment projects across Europe.

While the CEB has existed for seven decades, its mission is more relevant than ever. Unlike larger multilateral development banks such as the World Bank or Asian Development Bank, which have broad mandates, the CEB has an exclusively social focus: “Social investment is the bedrock of social inclusion, which is a necessary foundation of inclusive, fair and good societies”, Monticelli explains.

In practice, this means that the CEB helps finance projects such as hospitals, schools and social housing. It also finances small and medium enterprises and supports microfinance initiatives aimed at people who are often excluded from traditional banking: people with disabilities, single mothers and migrants, for instance.

In fact, the Bank works tirelessly to ensure its projects have high social benefits for all, especially the most vulnerable. The CEB operates across 43 member countries, but its impact is particularly important at the local level, where the delivery of social services and people’s needs meet.

Social investment on the ground in Europe

Like Barcelona, affordable housing is a challenge for many European cities, including Berlin, where the CEB has just signed a second €100 million loan with Gewobag, a municipal social housing company, to build thousands of social and affordable homes. These projects serve low-income and vulnerable households while also meeting strict sustainability standards for greener, low-carbon living.

Access to finance can be decisive for social inclusion. Amene Vasefi, a refugee from Iran, was able to open her own hair salon in Sofia after receiving a microloan. With support from a local lender funded by the CEB, she turned her skills into a stable business and a new start.

For others, the challenge is access to stable employment. In Dublin’s Northside, the social enterprise Speedpak is helping people break the cycle of long-term unemployment through a combination of paid work, training and tailored support. Michael, who had been out of work for several years, joined the programme and has since moved into a senior operational role, now mentoring new trainees.

This kind of impact is made possible through targeted social finance supported by the CEB.

Social investment brings social cohesion

Stories like Estel’s, Amene’s or Michael’s can be found right across Europe. Each may seem small, but they are threads in a much larger tapestry - one that holds communities together. Their stories show how targeted support at the local level can translate into broader stability. They highlight how effective close collaboration can be, involving local authorities, community groups, businesses and others on the ground, with the CEB weaving it all together to ensure that every project leads to better lives and a stronger social fabric.

This is the guiding idea behind social investment: investing in people, for people, in order to make economies more resilient. Each year, the CEB finances scores of such projects - some small, others larger - together representing billions of euros in investment across Europe.

In 2025 alone the CEB approved €4.5 billion in new social loans across 26 countries, reflecting the scale of its commitment to social investment.

Responding to long-term needs but also urgent crises

While most of the CEB’s projects address longstanding social needs, the Bank also provides vital support to help countries cope with sudden emergencies, such as earthquakes and floods.

This operational agility was evident after Russia’s 2022 brutal aggression against Ukraine, when the CEB was among the first international financial institutions to mobilise resources to help manage the immediate humanitarian and social crisis, while also helping to rebuild the country’s homes and healthcare services to ensure a future for its people.

In a world facing so many challenges and uncertainties, social investment adds vital strength to Europe’s social fabric: one project, one community, one life at a time.

Turning off the news will not make today’s challenges disappear. But looking more closely shows that solutions do exist, often less visible, but with very real benefits.

For seven decades, the Council of Europe Development Bank has invested in people, in communities, and in the social foundations that underpin Europe’s resilience. Europe’s ability to withstand successive crises owes much to this patient, skilful, people-centred needlework.

This article is Partner Content published by Euronews as part of celebrations to mark the CEB’s 70th anniversary, 16 April 2026 EURONEWS

© Euronews April 2026