A framework loan of EUR 100 million for 20 years signed by the European Investment Bank (EIB) and the Czech Konsolidacní Banka (KOB) today will help finance a number of smaller water supply and wastewater schemes across the Czech Republic.

Commenting on the loan, EIB Vice-President Wolfgang Roth said: 'The EIB and the Czech authorities, namely the Ministry of Agriculture, the Ministry of Finance and KOB joined forces to develop a mechanism for channelling suitable funding to smaller towns and regional entities undertaking urgent investment into the modernisation of the water sector throughout the country. Such investment is required to reach EU water quality standards in view of upcoming Czech accession to the Union. Together with last year's EUR 50 million loan for upgrading the water networks in Prague, this new loan brings EIB support to municipal water schemes to EUR 150 million.'

The EIB, the European Union's financing arm, provided its first loan for projects in the Czech Republic in 1992 and lent over EUR 2.3 billion in the Czech Republic so far. More than half was lent to Czech transport schemes, including some EUR 400 million for the modernisation of the major international railway lines in the country. Other EIB loans went to the Czech telecommunications fixed network, environment-friendly investments in several coal-fired power stations in northern Bohemia, municipal infrastructure and the reconstruction of infrastructure damaged during the 1997 floods in northern Moravia. Small and medium-scale industrial and energy investments are being financed through global loans (credit lines) to Czech and international commercial banks in the Czech Republic.

Since 1990, the EIB has lent some EUR 11.5 billion to projects in thirteen Central European countries: Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia, Hungary, Slovenia, Romania, Bulgaria, FYR of Macedonia, Bosnia and Herzegovina and Albania. Annual lending in the ten Central European candidates for EU accession has averaged some EUR 2 billion between 1997 and 1999. In line with decisions by the EIB's Board of Governors (the fifteen EU Finance Ministers), lending to projects in the region may double to an annual EUR 4 billion over the coming three years.

1 EUR = 1,95583 DEM; 0,613400 GBP; 35.5850 CZK.