The European Investment Bank (EIB) announces a EUR 100 million(1) loan made available to Thüringer Talsperrenverwaltung through the intermediary of Landesbank Hessen-Thüringen. The loan will go towards financing completion of the Schwarza water supply scheme, in particular construction of the Leibis/Lichte reservoir and environmental protection measures. It will cover around 50% of estimated project costs, with the balance funded from regional government budgetary contributions and other long-term bank loans.
The new drinking water storage dam in Thuringia's Schiefergebirge, scheduled for completion by 2005, is intended primarily to collect and store raw water for human consumption and, secondly, to contribute to flood protection. The project complements the Weida/Zeulenroda/Lössau reservoir system and as such forms part of the East Thuringian water supply network. It will help to cover East Thuringia's long-term requirements for high-quality drinking water.
The EIB is supporting the project in response to East Thuringia's need for reliable water supplies and flood protection.
The finance contract was signed at the EIB's headquarters in Luxembourg by EIB Vice-President Wolfgang Roth and by Jens Peters, Chief Executive of Thüringer Talsperrenverwaltung, and Volkmar Klausser, the utility's Commercial Director. Stressing the long-term benefit of this major public investment project, the EIB Vice-President also welcomed its happy timing, given that the declining trend of the construction industry in Eastern Germany made public investment highly desirable as a generator of jobs.
As the long-term financing arm of the European Union, the EIB is mandated to support the Union's policy objectives by providing long-term finance for economically sustainable investment projects. One of its chief aims is to promote the economic development of less advanced regions. All nine of Germany's eastern Länder rank as Objective 1 areas under Europe's regional development policy. As such, they have attracted a large volume of EIB finance, amounting to date to an aggregate of EUR 14.3 billion, equal to around half of total Bank lending in the Federal Republic since 1990. As well as infrastructure projects, the EIB finances new ventures mounted by businesses in regional development areas. Where loans of less than EUR 25 million to SMEs and local authorities are concerned, the EIB channels its loan finance through partner banks in Germany, who also deal with the loan applications as such.
(1) 1 EUR 1 = DEM 1.95583; 0.624100 GBP