The European Investment Bank (EIB) is investing up to EUR 15 million (33 million Dutch guilders)(1) in Gilde Europe Food and Agribusiness Fund B.V., a private venture capital fund targeting fast-growing SMEs with high-tech potential in the food and agribusiness (F&A) sector in Europe. The EIB's participation, along with a prospective EUR 125 million in private funds - of which 75 million already secured, is intended to provide equity and quasi-equity input towards financing 30-40 leading European SMEs, active in the forefront of new F&A technologies with a global application. The Fund Manager is Gilde Investment Management B.V., an associate of Rabobank, a leading bank in the F&A field and a well-known EIB partner.

Gilde Europe Food and Agribusiness Fund is the only venture capital fund in the European Union dedicated to F&A, a sector in which Europe enjoys a number of decisive advantages compared to the United States and Japan. F&A has always been able to draw on an excellent scientific base in Europe within both academic institutions and major food and life sciences corporations and currently benefits from the European Union's support under the Fifth Framework Programme for Research and Development (1998-2002), as well as from the EU Member States for the purpose of enhancing increased entrepreneurial activity (start-ups) in F&A.

EIB Vice-President Rudolf de Korte stressed that the Bank's investment in the Fund is in line with EIB policy of backing pan-European risk capital funds, particularly those specialising in technology. He stated that: `The role played by the EIB in implementing the European Union's policy of promoting a European economy based on innovation and knowledge, notably by consolidating the capital base of innovative SMEs, was recently confirmed in the Lisbon European Council's Conclusions. Under its"Innovation 2000 Initiative", the Bank is providing a further one billion euro for risk capital operations, in addition to the first billion made available since the end of 1997. It has also launched a dedicated 3-year lending programme of 12 to 15 billion euro, in support of: human capital investment; SMEs and entrepreneurship; research and development; IT and telecommunications networks; and increased innovation."

The EIB's risk capital activities are to be managed by the European Investment Fund (EIF) as the specialist risk capital arm of the EIB Group. The EIF's shareholders, at their Annual Meeting on 19 June 2000, approved a reform of the Fund allowing the EIB to become the majority shareholder with a stake of over 50%. The reform clears the way for the concentration of all the EIB Group's risk capital activities in the hands of the EIF and will make it possible to target operations in this highly specialised field more effectively. The EIF is a public-private partnership, established in 1994 by the EIB, the European Commission, on behalf of the European Union, and private and public financial institutions from all 15 EU Member States. The EIF furthers inter alia access to investment finance by SMEs, including risk capital funds for innovative businesses.

As the European Union's financing institution, the EIB funds capital investment contributing towards one or more of the following EU objectives: regional development; transport, telecommunications and Trans-European Networks (TENs); secure energy supplies; improvements to the natural and urban environment; development of infrastructure in the health and education sectors; enhanced competitiveness and integration in European industry; investment by SMEs; risk capital finance. Outside the EU, the Bank participates in implementing the EU's development policy in accordance with the terms of the various agreements which the Union has concluded with some 130 countries. Owned by the EU Member States, the EIB raises its funds on capital markets (AAA issuer).

Over the past five years (1995-1999), total EIB loan signatures in the Netherlands amounted to EUR 2.2 billion, of which some EUR 600 million in the form of global loan finance. Individual loans went inter alia towards construction of household incineration plants in Nijmegen, Alkmaar and Moerdijk; improvements to the country's air traffic control system; a new motorway tunnel in the Province of Noord-Holland; upgrading of water supply systems in the Provinces of Noord-Holland and Limburg; an urban development project in Amsterdam; commissioning of a mobile telephony network; construction of a factory near Zwolle to produce diesel engines; and strengthening of river dykes in the Province of Gelderland.

(1) EUR 1 = NLG 2.20.