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European Investment Bank and EBRD will co-manage EU-supported projects in Eastern Europe and Central Asia
The EBRD has joined forces with the European Investment Bank to finance
projects in countries to the east of the European Union, leveraging
significant EU funds for the ‘eastern neighbours’ and potentially Central Asia
with the EBRD’s experience of project financing in the region.
The EBRD will co-finance EIB transactions in Russia, Ukraine, Moldova and the
Southern Caucasus, as well as, depending on a new decision of the Council, in
Central Asia. The EIB has been authorised by the EU Council to extend loans
that could exceed €3.7 billion until 2013 (or about €500 million per year) for
co-financing investment projects in this region.
The EIB and the EBRD will work together to identify projects that meet the EU
priority of financing major infrastructure. Transactions will be structured
and negotiated jointly by both institutions, drawing on the EBRD’s particular
expertise and long experience working in the region. The EBRD will share the
risk by providing up to 50 percent of the financing for each joint project,
and all transactions will have to meet both EIB and EBRD conditions, including
integrity, sound reporting, environmental standards and transition impact.
EIB President Philippe Maystadt said that region covered by the agreement is
critical because it includes the countries that are close neighbours of the
EU, all of which need modern infrastructure that will boost economic
development as well as fostering regional ties amongst countries within the
region and with the EU. He said the most efficient way to undertake these
large infrastructure projects is in partnership with the EBRD, which already
has deep knowledge of the region.
EBRD President Jean Lemierre characterised the arrangement as a positive
example of co-operation between international financial institutions, with the
EIB and the EBRD each contributing to the high standards and efficiency of
projects in a way that will bring the greatest value to people in countries
that are in transition to full market economies. He commended the EIB’s
approach of fostering co-operation rather than competition between
international institutions.
The European Commission has set projects involving transport, energy,
telecommunications and environmental infrastructure as main priorities for the
EIB in this region. Particular priority should be given to projects that will
extend the trans-European networks and promote regional integration.
The co-financing arrangements are detailed in a Memorandum of Understanding to
be signed before the end of the year between the European Commission, the EIB
and the EBRD.
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