In its mission to facilitate the integration of the Central and Eastern European countries with the European Union, the European Investment Bank (EIB), the Union's long-term financing institution, is providing ECU 165 million (1) for a crucial link between the Czech and German motorway networks.
The loan will mainly help finance the construction of a 62km motorway stretch between Pilsen and the Czech-German border, as well as customs facilities on the new motorway. The new motorway will facilitate traffic between the Czech capital Prague and a number of important industrial centers in nearby Germany and the EU in general.
Commenting on the loan for the new motorway, EIB Vice President Wolfgang Roth said: "Following the redirection of traffic flows after 1989, it became clear that the TEN corridor Nürnberg-Prague needed to be upgraded along with its associated customs facilities. The EIB was associated to the preparation of the project since the beginning and commissioned an initial survey of traffic and its projected growth. Construction is co-financed with the Czech State budget. Today's loan agreement is an important milestone in the development of TENs between the EU and the candidate countries in Central and Eastern Europe.' It follows other motorway projects financed by the Bank in Poland, Hungary, Slovakia, Slovenia, for a total amount of M ECU 435. It reinforces the key role of the Bank in further economic integration of the region with the Union, and in the development of its basic infrastructure.
The loan for this important section of the Nürnberg-Prague motorway brings total EIB lending in the Czech Republic since 1992 to ECU 1 232 million. Previous EIB loans went to finance the main north south railway lines, the modernisation of the Skoda car factory and the construction of a connected heat and power plant, the modernisation of the telecommunications network, the upgrading of several lignite-fired power stations to reduce flue gas emissions, and improvements to the road network. The EIB is also assisting the development of small and medium-scale manufacturing and tourism ventures through its global loans (credit lines) to the Czech banking sector.
The EIB was established in 1958 under the Treaty of Rome and is the European Union's long-term financing institution. In 1996, the Bank provided loans totalling ECU 23.2 billion. Nearly 5 per cent of this was for projects in eleven Central and Eastern European countries: Albania, Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia. Since 1990 and the end of 1996, the EIB lent more than ECU 5 billion to projects in these countries. A new mandate for the years 1997-2000 earmarks another ECU 3.52 billion for loans in the region. In addition, the EIB will also create, at the request of the Council of Ministers, a substantial pre-accession lending facility to help Central and Eastern European countries prepare for EU-membership.
(1) The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 30 September 1997, when ECU 1 = GBP 0.69, IEP 0.76, USD 1.113, CZK 36.6244.