EIB accompanies the growth and diversification of the Polish economy
- Lending activity up 13% year on year in 2017 to over EUR 5bn
- Since 1990 EIB has provided approximately EUR 65bn in financing to Poland, covering around 420 projects and investment programmes in all sectors of activity
- New operations signed in early 2018 include a EUR 580m loan for road upgrading in south-east Poland (S19) and two loans to the City of Poznan for public transport and social housing projects (the latter under the “Juncker Plan”) for a total amount of over EUR 150m
Loans granted to Poland by the European Investment Bank (EIB) totalled EUR 5.042bn in 2017, a year-on-year increase of 13%. Including the EUR 358.2m in equity investments and guarantees granted by the European Investment Fund (EIF), the EIB Group’s overall engagement in the Polish economy amounted to EUR 5.42bn, making Poland the fifth-largest recipient of EIB financing, after Italy, Spain, France and Germany. In particular, Poland managed to roll out the Investment Plan for Europe, with EUR 1.1bn of operations guaranteed by the European Fund for Strategic Investments (EFSI).
“2017 was an excellent year for the EIB in Poland, with high lending volume and a well-diversified loan portfolio”, commented Vazil Hudák, Vice-President of the European Investment Bank, who oversees operations in cohesion countries including Poland. “The European Union bank has continued to finance not only large infrastructure projects, namely rail and roads, but also high value-added projects in RDI and smart development such as the Krakow Intelligent and Sustainable Development project. We also supported a wide number of Polish municipalities’ modernisation plans, contributing to cohesion goals and better living standards across the country. Also of note is our financing of large corporates' investment plans and our provision of affordable funds to SMEs to spur their growth.”
In keeping with previous years, the EIB committed over half of its loans (EUR 2.65bn) to modernising the public sector including transport networks and infrastructure upgrading, cities' development projects, education and research. EUR 1.54bn of intermediated lending went to banks and leasing companies, which on-lent the funds to mid-caps and SMEs, while around EUR 850m was borrowed by corporates and energy groups. Lending volume to banks, leasing companies, corporates and energy groups was up year on year, showing positive demand trends outside the public sector also.
Rolling out the Investment Plan for Europe
As part of the EIB Group’s activity, financing under the EFSI, a central element of the Investment Plan for Europe (“IPE” or “Juncker Plan”), helped unlock more investment opportunities in projects that would otherwise find it hard to get financed due to their higher risk or innovative aspect. EFSI operations amounted to EUR 1.1bn in 2017, which was a record year for EFSI operations with Polish banks, with EUR 696m of loans signed (45% of total lending to banks) compared to EUR 150m in 2016. “More risk sharing with Polish banks means more funds being made available to Polish companies and SMEs for their innovative projects and development. That's precisely the aim of the Juncker Plan – to spearhead investments in the European economy”, said EIB Vice-President Vazil Hudák.
Total EFSI approvals in Poland as at 31 December 2017 (since the launch of the IPE) amounted to EUR 2.56bn, helping trigger close to EUR 9bn of EFSI-related investments in the country.
The EIB turns 60, with over 25 years of operations in Poland
This year marks the 60th anniversary of the European Investment Bank, which was created in 1958 by the Treaty of Rome signed the previous year establishing the European Economic Community, now the European Union (EU). In its 60 years of operations, the EIB has disbursed EUR 1.1tn for projects in 162 countries, making it the world's largest multilateral lender.
In Poland, where the EIB started operations in 1990, the Bank has financed around 420 projects and investment programmes worth approximately EUR 65bn across the whole country and in all sectors of activity. Poland is by far the largest recipient of EIB funds among the countries that have joined the EU since 2004.
“The European Investment Bank has been a solid companion of the Polish economy in its successful transformation and development over the past quarter of a century. We intend to remain a strong and reliable partner, contributing to Poland's sustainable and balanced growth”, said EIB Vice-President Hudák. “We look forward to extending our lending and advisory activity to more sectors and accompanying the ongoing diversification of the Polish economy”, concluded Mr Hudák.
A good start to 2018: new signatures for national and local projects
Three new operations were signed earlier this month for a total amount of some EUR 736m. These include a EUR 580m loan for road upgrading signed at the beginning of January with Bank Gospodarstwa Krajowego (BGK), acting on behalf of the National Road Fund, which will help finance the construction of a 157.5 km stretch of the “S19 Lublin-Rzeszow Expressway” connecting Warsaw to the south-east of Poland.
Two other loans were signed yesterday in Poznan. A PLN 485m (EUR 114m) loan granted by the EIB to the municipal transport company in Poznan (Miejskie Przedsiebiorstwo Komunikacyjne w Poznaniu, or MPK Poznan) will finance the renewal of the tramway rolling stock, the purchase of new buses, including electric ones, and the modernisation of tram and bus depots.
A PLN 178m (EUR 42m) loan granted by the EIB to the municipal communal housing company in Poznan (Zarzad Komunalnych Zasobów Lokalowych, or ZKZL) will finance the construction or refurbishment of around 1 160 social housing apartments and 14 community healthcare centres in Poznan, providing new or improved social housing for nearly 3 000 people. This first EIB direct loan to ZKZL was made possible by the EFSI, which provided the guarantee for the operation.