Mr Sauli Niinistö, Vice-President of the European Investment Bank, the European Union's financing institution, has signed a loan agreement for the amount of 100 million EURO on 10 November to Wärtsilä Oyj, one of Finland's oldest industrial companies.

Wärtsilä is one of the world's leading suppliers in two niche segments: gas and diesel fired engine and propulsion systems for the shipping industry as well as large independent power generation units. The EIB part-financed project focuses on a Research & Development (R&D) programme, which aims at developing innovative solutions for achieving greater energy efficiency and reduced emissions of internal combustion engines produced by Wärtsilä. Wärtsilä's R&D, set up in close cooperation with local universities and other research centres, has many pioneering aspects from a technological point of view and tangible environmental benefits. The company, where R&D is an essential part of its strategy, has the intention to produce engines that already comply with future regulations. Wärtsilä's main R&D centre is located in Vaasa (Finland).

Improving the efficiency of large marine engines and electricity generation units will result in significant energy savings and CO2 reductions and is consistent with the Climate Change Strategy of the European Investment Bank. Further environmental benefits include reduction in NOx emissions and improved safety standards on ships. Furthermore, the investment falls under the EIB's Innovation Initiative, a programme that was recently renewed and which will remain a key priority for the Bank as far ahead as 2010.

Mr. Sauli Niinistö, EIB Vice-President, said: The EIB is pleased to be supporting a project which, in terms of its environmental benefits and innovative aspects, fits in so well with two of the Bank's key policy objectives of innovation and environmental protection. This is also the first industrial R&D facility in Finland for the EIB.

Mr Ole Johansson, President and CEO of Wärtsilä, said: "The EIB loan is of major importance in developing our business. In an environment where increased price competition challenges production in Europe, it emphasizes the importance and capabilities of European R&D.

The European Investment Bank, the European Union's long-term lending institution, finances capital investment furthering EU integration, in particular: regional development, trans-European transport, telecom and energy networks; industrial competitiveness; SMEs, and environmental protection. It also operates outside the EU within the framework of the EU's policy for co-operation and development. Owned by its Member States, the EIB raises its funds on the capital markets (AAA-rated issuer). As part of its remit, the EIB supports the development of infrastructure networks with a Community dimension, notably in the transport sector.

Within the EU, the EIB priorities include regional development, economic and social cohesion, environmental protection, and an innovative, competitive European economy. Priority is further given to the economic integration of the future Member States into the Union. In 2002, regional development absorbed an aggregate EUR 22.9 billion in the present and future EU Member States.

EIB financing in support of the EU's strategy for a competitive information and knowledge-based economy amounted to EUR 3.6 billion in 2002.