The European Investment Bank (EIB), the long-term financing institution of the European Union (EU), is advancing a EUR 120 million (ESP 20 billion) (1) loan to EUSKALTEL S.A. to part finance the second phase of construction of its broadband cable telecoms network in the Basque Country.

This four-year project - comprising the laying of optical fibre, coaxial and telephone cables, installation of electronic equipment and execution of civil works - will enable Euskaltel to provide fixed telephony, high-speed Internet, data transmission and cable TV services. The first phase of Euskaltel's capital spending programme, also part financed by the EIB, was completed last year. 

Improving telecoms services for the Basque Country's 2.1 million inhabitants will heighten competition and give a boost to the region's economic development, especially in high-tech and cutting-edge sectors. This project forms a landmark in the creation of the information society, an objective identified by the European Council at its special summit in March 2000 and subsequently incorporated into the EIB's Innovation 2000 Initiative. 

The EIB was created in 1958 by the founding treaty of the European Economic Community, the Treaty of Rome. It was set up to contribute to the integrated and balanced development of the Member States, as well as to their economic and social cohesion, by providing long-term finance for capital investment fulfilling EU objectives. The EIB plays a major role in funding communications, including telecommunications, infrastructure, as a means of fostering European integration. Such infrastructure helps to bring the Member States closer together, enhancing the potential for economic growth in the EU's poorest and most remote regions.Owned by the EU Member States, the EIB raises the resources for its lending operations on the capital markets, where its bond issues are consistently rated AAA.

(1) EUR 1 = ESP 166.386, 0.638700 GBP