The European Investment Bank, is donating EUR 1 000 000(1) as an emergency grant for urgent reconstruction in the greater Athens area, recently hit by a devastating earthquake. The funds will be made available for the reparation and reconstruction works of school buildings of the most affected areas, in view of the start of the new academic year.
In recent years the European Investment Bank has provided immediate humanitarian grant aid to countries or regions severely hit by disasters, such as the East-German regions, Poland and the Czech Republic in September 1997, Honduras and Nicaragua in 1998, Kosovo in May this year, and Turkey earlier this month.
In addition, the Bank seeks to help finance reconstruction through its more regular lending activity. Over the past years, the EIB has continued to strengthen its operational expertise and contacts in Greece, which will serve as a basis for developing fast track lending in the region hit by the earthquake. In the past the EIB has financed the reconstruction of Kalamata, damaged by earthquakes in September 1986, with seven loans totalling EUR 100 million, carrying a 3% interest subsidy from the European Union budget.
The European Investment Bank (EIB), established in 1958 under the Treaty of Rome setting up the European Community, is the European Union's long-term financing institution supporting capital investment projects that further European integration. While strengthening economically weak regions in the European Union (EU) has always been its main objective, the Bank also finances projects in support of other EU policies. In some 120 countries outside the Union the EIB is participating in the implementation of the EU's development and co-operation policy. In 1998, the EIB provided loans totalling some EUR 29.5 billion, of which EUR 736 million for projects in Greece. The Bank borrows on the capital markets the funds for its lending. Its bonds have regularly been rated "AAA" by the leading rating agencies. As the EIB works on a non-profit basis it can pass on to project promoters the excellent conditions it obtains on the markets. The EIB normally finances up to 50 percent of project cost; on average it provides one third of the funding and co-finances investments with other institutions.
(1) 1 EUR= 324.450 GRD, 0.6663000 GBP.