Two loans totalling EUR 108 million were signed in Sofia by the European Investment Bank (EIB), the European Union's long-term financing institution, and the Bulgarian Government:

  • EUR 80 million are for upgrading the 150 km single-track railway Plovdiv-Dimitrovgrad-Svilengrad, on TEN Corridors IV and IX linking Western Europe with Greece and Turkey. Works mainly comprise new embankments, bridges and tracks, better route geometry, as well as electrification and a centralised traffic control system. After completion, the infrastructure financed will allow speeds up to 160 km/h. Total EIB financing for this project could eventually reach EUR 150 million.
  • EUR 28 million are for building three waste water treatment plants for the cities of Stara Zagora, Haskovo and Dimitrovgrad in the lower Maritsa River Basin in south-eastern Bulgaria, serving a combined population of some 280 000. The investments also comprise corresponding sewage networks for the three cities, enabling them to treat used waters to EU standard level and significantly improve life quality for the inhabitants.

The European Commission is expected to co-finance both projects with grants under its Phare and ISPA programmes.

The EIB loans signed bring to EUR 679 million the total made available by the Bank for transport, energy, telecommunications and environmental projects in Bulgaria since 1993. Commenting on the loans, EIB's Vice-President Wolfgang Roth said: 'I am very satisfied that EIB financing in all ten Central European candidates for membership in the European Union is continuing at a strong pace. The combination of EU grants and loans from the Union's long-term financing arm, will help ensure that no new gaps are opened between the candidate countries earmarked for early entry and those to follow later. In this respect, the sustainable development of adequate infrastructures in all ten candidate countries is particularly important. By more than doubling its lending to projects in the candidate countries this year compared with 1997, the EIB also hopes to accelerate accession by fostering economic growth and employment.'

The EIB was set up in 1958 under the Treaty of Rome to provide loan finance for capital investment furthering European Union policies. While strengthening weaker Regions in the EU has always been its main goal, the Bank also lends to projects outside the European Union under the EU co-operation policy toward third countries. For instance, in 1998 loans totalling 2.4 billion euro were channelled to projects in the ten Central European countries preparing for EU membership. Owned by the fifteen Member States, the EIB raises the bulk of its funds on the capital markets worldwide where its bond issues have always earned the best credit rating `AAA'.

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