Europe’s super capex cycle: financing transformation

Manel Chaoui (Strategy Officer in the Corporate Development team within BNP Paribas’ Securities Services business): Hi and welcome back to the HoT Talks series. Today we’re in Paris with Geert Lippens, Head of CIB EMEA countries, to discuss BNP Paribas’ strategy and CIB’s ambitions for the region. Hi Geert, could you tell us what are the main structural dynamics shaping Europe today?

Geert Lippens (Head of CIB EMEA countries, BNP Paribas): Europe is going through a big transformation, actually a big building phase, and I think we’ve all heard the word by now that is called the super capex cycle for Europe, and that is actually composed out of three big components. The first one I would name under sovereignty. Sovereignty means that Europe wants to get strategic autonomy. Strategic autonomy is going to cover, first of all, defence. Defence is going to be massive. We estimate that defence will require several billions of euros per year that will have to be invested, and it’s not just about purchasing defence material, it’s also about the industrial base. The second pillar is going to be around infrastructure. Electrification alone, we all know, we’re driving electric cars, we see it everywhere, we’re going to be making electric steel, etc. So, electrification alone is going to be requiring an investment of EUR500 billion per year, which is massive, which is huge. It’s not just about production of electricity, it’s also about the whole transmission, the logistics around it. This is going to require a massive upgrade in Europe. It’s also to do with technology. We all hear about AI. We all hear about the new digital revolution. I think we have to realise that AI requires a massive amount of electricity to produce it. You’re going to have to invest also in data centres and the cloud and the likes of it. The language learning models or the agentic AI models that we are talking about now, they’re going to require also a lot of data and infrastructure, something I think in Europe we’re only seeing the start of it for now. So, Europe is in a transformation phase, it’s in a building phase, but it’s super exciting.

Manel Chaoui: Could you tell us how BNP Paribas is supporting Europe’s ambitions?

Geert Lippens: I think BNP Paribas as a financial institution has its role to play in Europe. Europe is our home market, and it’s also something we have to do towards society. Society is changing. We have a role to play. So, I want a few examples I can share on this point is we have already committed EUR250 billion on the low carbon transition. We’ve been financing green steel. We’ve been financing a lot of offshore wind parks, electricity transmission, production, etc. So, this is something which is very tangible. But also in defence, we’re moving ahead, and I think in 2025 alone, we’ve been supporting EUR6.5 billion in investments. We’ve also been financing EUR2 billion in new financings for defence, and what I can see also now in 2026 is a massive growth in those volumes. You can see the geopolitical environment is only accelerating that. First of all, we have the expertise across the Bank. If a client wants to do a hedging, if a client wants to have a project finance, or if a client has a new project in whatever sector, we have very good sector expertise, we can bring that around the table. So, what we do is we put the client or we put the project at the centre, and we look across the bank. Where can we bring added value? What value can we bring? What is the best product suited? And where can we actually help this kind of project or the client to a successful financing structure going forward? The second thing is that we have the local setup. The key motto is we need to understand locally what it means for our clients. So, the local coverage, the local content connectivity is important to make sure that we bring the right expertise to the project locally. We have a big geographical diversification. So, I think we have what it takes to deliver that, and then you need to be able to bring the scale. In today’s world, we are still one of the very few banks that have been able to create the scale and has been able to invest because of the scale we have and all the capabilities that are required to help this big transition in Europe, and the scale means also that we need to be able to bridge these financings. So, we actually act also as the bridge between the projects, the clients, and those institutional investors that take long term positions and are happy to commit financing to those projects also.

Manel Chaoui: On a more personal note, could you tell us what you like to do outside of work?

Geert Lippens: I think my job is, as I just explained to you when we were walking, it’s quite intense. It’s very passionate. It’s very interesting, but also intense. My decompression is I live in Belgium on a farm. I have some animals. I have donkeys and I have sheep and I have also dogs. The sheep are mainly because I want to have a low carbon lawn mower, if you want to call it that way. They cut the grass, so I don’t have to drive around on the weekends, but we basically have a farm where I can decompress, I can go and chop wood, I have a tractor, I can drive around with a tractor also, it is good fun, and I can actually do also building. I have a few building projects that I manage. It’s for me also a way to think about what is the next thing that I need to develop with my teams, what do I need to think through to get successful in the next phase of whatever country plan that we’re trying to do.