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European Bank signs loan for residential construction
The European Bank for Reconstruction and Development has signed a loan agreement with the Republic of Poland to help finance residential construction projects by private and public developers across Poland.
The US$ 67 million (ECU 55 million equivalent) loan is part of a total finance package of ECU 269.4 million, co-financed with the World Bank (ECU 80.6 million), the Polish Government (ECU 26.6 million), a consortium of Polish banks (ECU 40.3 million) and other investors (ECU 66.9 million).
The Polish Ministry of Spatial Economy and Construction and the Polish Bank Rozwoju Budownictwa Mieszkaniowego S.A. will be executing agencies on behalf of the Government.
Mario Sarcinelli, Vice President for Development Banking, said "The objective of the loan is to increase the quality and quantity of housing production through greater involvement of the private sector. The project will support the transition from a centrally subsidised housing system to a market based supply of land development and new dwelling construction."
The benefits of the project include the creation and growth of developers and contracting firms, a labour intensive industry characterised by small size private entrepreneurs. New housing also derives employment generation through investments and consumption in large sectors of the economy such as utilities, home services and goods.
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