The European Investment Bank (EIB) is lending EUR 60 million¹ for a new factory at Dorog, northern Hungary, to produce rechargeable batteries mainly for mobile telephones in Europe. The ten year loan is going to Sanyo Hungary Kft., a subsidiary of Sanyo Electric Co. Ltd, Japan, and is guaranteed by The Sumitomo Bank, Ltd.
The EIB supports foreign direct investment in Hungary and other Central European candidates for EU membership in order to raise the competitiveness of local industry through the transfer of know-how and new technologies. The green-field plant to be built by Sanyo will raise the local content of its European battery activities, substituting imports from Japan. Furthermore, the new plant should create about 1200 permanent jobs, thus representing a boost for the regional development of this part of the country.
The EIB usually finances larger projects with direct loans to the promoter, whilst furthering investment by small and medium-sized companies (SMEs) through credit lines (global loans) to suitable banks in each country, which onlend the funds to the final beneficiaries, which to date number some 300 in Hungary alone.
The EIB is the financing arm of the European Union and is steadily increasing its lending in the ten Central European countries preparing for EU accession. With more than EUR 12 billion lent to projects since 1990, EIB is already the largest multilateral financing institution in the region. Working closely with public and private sector investors, the EIB gives priority to the implementation of EU policies and standards in the field of environmental conservation, transport, telecommunications, energy, industry, tourism, health and education.
(1) EUR 1 = 1.95583 DEM, 0.596700 GBP