The European Investment Bank (EIB), the European Union's long-term credit institution is providing an ECU 60 million loan for improving the Bulgarian road network. The EIB loan will help upgrade some 600 km of transit roads throughout Bulgaria, including the completion and repairing of sections of the Hemus and Trakia motorway near Pleven, in north-central Bulgaria and the upgrading of part of the southern ring road of Sofia. Additional EU financing for this project will be provided by the European Commission in the form of a PHARE grant.

The loan to the Republic of Bulgaria is for 20 years with a five-year grace period. The funds will be used for improving a number of priority transit roads on Corridors IV, VII and IX of the Pan-European Road Network for Central Europe which were singled out for urgent upgrading in the recent Pan-European Transport Ministers' conferences in Crete and Helsinki.

The loan agreement was signed yesterday in Luxembourg by Mr. Evgeniy S. Bakardjiev, Bulgarian Deputy Prime Minister and Minister of Regional Development and Public Works, and EIB Vice-president Wolfgang Roth. Commenting on the loan, Mr. Roth said: 'These road works will improve driving conditions and safety in many areas and improve traffic fluidity along the main transit corridors. The EIB wants to help reduce further the backlog of urgent road improvements by complementing with its lending the scarce local funding available at this point in time.'

The loan brings total EIB financing in Bulgaria to ECU 446 million. Previous loans were for various road improvement schemes, for the completion of a coal-fired power station, the extension and modernisation of Sofia Airport, the modernisation of the telecommunications network and for upgrading the air-traffic control system. The EIB also provided a global loan (credit line) to Bulgaria's banking sector for financing investment by small and medium-scale companies.

Since it started lending in Central and Eastern Europe in 1990, the EIB has provided some 8 billion ECU for projects in Poland (2 151 million), the Czech Republic (1 792 million), Hungary (1 142 million), Romania (1 052 million), Slovakia (615 million), Bulgaria (446 million), Slovenia (325 million), Lithuania (148 million), Estonia (88 million), Albania (68 million) and Latvia (61 million). For the period 1998 to January 2000 a further ECU 5.6 billion has been earmarked for projects in the region, including ECU 150 million for transport and other infrastructure projects in the FYR Macedonia where the EIB began lending at the beginning of this year.

The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 30 June 1998, when ECU 1 = GBP 0.66 , IEP 0.78 , USD 1.09590 , LEV 1978.78.