The European Investment Bank is providingEUR 200 millionto Instituto de Crédito Oficial (ICO). ICO will on-lend the funds to support investment in R&D and innovation, and to strengthen the productivity and competitiveness of small and medium-sized enterprises (SMEs) located mainly in assisted areas throughout Spain.
The loan is part of EIB's Innovation 2000 Initiative (i2i) to promote a knowledge-based and innovation-oriented economy. i2i focuses on human capital formation, research and development, dissemination of innovation, development of SMEs and entrepreneurship, as well as information and communications technology networks.
The loan will allow ICO, the Spanish State's credit agency and the main source of financing for SMEs, to facilitate SME's access to long-term funds in equal terms with prime borrowers and large corporations. It will provide equal opportunities to entrepreneurs and business promoters regardless of their size. In addition, ICO will contribute to finance the construction of technological parks. Both schemes fall under the agreement between the ICO and the Spanish Ministry of Science and Technology and with the Spanish Scientific and Technological Parks Association.
In terms of job creation, SMEs are the most dynamic segment of the Spanish corporate environment, as well as important vehicles for the dissemination of innovation.
The EIB was set up in 1958 to finance investment furthering EU integration. The EIB concentrates lending in areas considered top priority by its shareholders, the European Union Member States. Current priorities are: EU regional development, i2i, environmental improvement and protection, preparation of candidate countries for accession, as well as support of EU development and cooperation policy with some 150-partner countries. The latter are in South Eastern Europe, the Mediterranean region, Africa, the Caribbean and the Pacific, Asia and Latin America.
In 2000, the EIB provided loans totalling some EUR 36 billion. The Bank borrows on the capital markets the funds it lends. Its bonds have regularly been rated "AAA" by the leading rating agencies. The EIB may finance up to 50 percent of project cost. On average it provides one third of the funding and co-finances investments with other institutions.