The European Investment Bank (EIB), the European Union's (EU) financing institution, has launched a Central European Flood Relief Programme, for financing flood relief in Austria, the Czech Republic, Germany, Slovakia and Hungary. The programme will be implemented in close co-ordination with the EU Commission.
A total amount of EUR 5 billion is under consideration for the Flood Relief Programme. A first Emergency Framework Loan of EUR 1 billion is currently put in place for immediate measures (1) in the affected regions.
Once the damage and the needs are more precisely identified, a broader follow-up programme will be presented. In addition, ongoing investments, which benefit from EIB loans and have been affected by the floods may also benefit from adjustments in their terms and conditions in line with those applicable to the Flood Relief Programme.
EIB's special support terms for loans directed to specific projects and action benefiting immediately the flood stricken areas could cover, on an exceptional basis, up to 100% of external funding requirements whilst having very fine interest rates, as well as particularly long repayment periods of up to 30 years. The Bank has offered to help the reconstruction projects of private and public entities in those sectors in which it is traditionally active.
Concerning the Kosicka bridge Bratislava project, EIB Vice President Wolfgang Roth reminded of the EUR 45 million loan that EIB had signed on 10 September 2001 with METRO Bratislava a.s., a special-purpose company owned by the City of Bratislava and the Slovak Republic. Regarding the tendering process for constructing the bridge, Mr Roth said: "The EIB has not intended and does not intend to influence the selection of companies tendering for a construction contract. However, a condition for the disbursement of the Bank loan is the proper application of tendering rules and procedures, which were agreed before the tender between METRO Bratislava a.s and the Bank in accordance with the Bank's procurement guidelines, in order to select the most economically advantageous offer. The EIB surveys closely the proper application of these rules and procedures throughout the tender process as required by its statutes. METRO Bratislava has now completed the tender evaluation. The Bank has found the selection of the winning tenderer to be in line with the Tender Documents. Hence the Bank does not object to the result of the tender".
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 2001, the EIB provided loans totalling EUR 36.8 billion. 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.
In recent years the European Investment Bank has provided immediate special credit support, as well as 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, Greece, Kosovo and Turkey in 1999 and in the Republic of Mozambique in 2000, Romania in 2000 and Hungary in 2001. EIB lending for flood reconstruction in recent years has totalled EUR 1 billion.
EIB's total lending for projects in Slovakia amounts to EUR 1 256 million. Most funds went to road, railways-, and telecommunications schemes. In addition, the air-traffic control system, power plants, gas transmission and storage facilities, as well as a waste incineration plant and the largest industrial plant in the Bratislava region were financed. The EIB has also granted credit lines (global loans) to several banks in Slovakia, which use the funds to finance projects undertaken by small enterprises and municipalities.
(1) EIB Vice President Wolfgang Roth informed the Governments concerned of the EIB special flood support programme in a letter to the Heads of the Governments of countries concerned on 18 August 2002.