The European Investment Bank has been a key player in assisting Poland and the other countries of the region in their efforts towards achieving EU membership and remains strongly committed to facilitate the process of European Integration. Since its first operation in the country back in 1990, the Bank has provided loans totalling close to EUR 7 billion for Polish priority projects in a wide range of sectors.

Support for investments in transport, which includes roads, rail and airports, new constructions, city by-passes, upgrading of standards and removal of bottlenecks, represents some 46% of the EIB's total lending in Poland. This reflects the importance and urgency of improving domestic and international links which will allow Poland to be part of the European Single Market as well as to play its strategic transit role. The long maturities and grace periods associated with the EIB financing make it very suitable for the financing of investments that have a long asset life and low pay-back profiles. EIB support has been practically provided for the construction to all sections of A4 Motorway from Krakow to the Polish/German border and, subject to possible outcome of new financing currently under consideration, it will also cover all sections of A2 motorway, from the German/Polish border to Warsaw outskirts. Support to A1 Motorway, from Gdansk to Brno in the Czech Republic, is also being considered.

Development of appropriate transport infrastructure is of vital importance for the development of industry and the growth of the SME sector, areas to which the Bank also attaches very high priority and has already provided some 22% of total lending in Poland. Working mainly in close cooperation with commercial banks and often through them, the Bank has been able to channel EIB funds - and the advantages of its AAA funding - to the rapidly progressing private sector in the country. Poland's EU membership will undoubtedly further increase demand for Bank financing from the private sector and partner banks in a context of an increasingly positive and predictable business environment.

Another area of rapidly increasing EIB involvement concerns support to municipal infrastructure. Loans to this end have been signed with eight major Polish Cities while EIB financing had also reached more than 20 other municipalities in various regions through the Bank's Global Loans. The need for compliance with the acquis communautaire make investments in the water and wastewater sectors urgent. EIB, often in cofinancing with available EU grants, has made it a priority to help improve standards and quality of life of the citizens of Europe. On the same theme, the Bank has also been supporting urban renewal and social housing projects.

EU membership brings Poland closer to the European Investment Bank. Financing from the EIB is provided on terms and conditions identical to those applicable to the current EU Member States. Operations are also structured along similar forms. A Facility to support the Polish National Development Programme is to be concluded later today. It draws on the Bank's experience for meeting such needs in other countries and widens substantially the field of cooperation. The Facility will complement EU's grant support under the Community Structural Funds. It aims at both facilitating and accelerating the implementation of investment schemes responding to the EU policy priorities for the further development of the Polish economy and its faster integration into the EU. Their benefits are expected to be both spread all over the country and have cross-border effects. The presence of the EIB, alongside the European Commission, will enhance the EU's support to a new Member State as well as further the Bank's support to a large number of investment schemes that - due to the relatively small size of their loan co-financing component - could not have direct access to EIB financing. The EIB funds will accordingly be used for financing research and development projects, innovation and high-tech centres; infrastructure in the education sector; transport projects, including intermodal transport links; expansion and modernisation of regional infrastructure to enhance regional competitiveness and reduce disparities. The loan will help Poland in its efforts to go ahead with investments under the Community Support Framework as from January 2004, thus facilitating the flow of EU grants soon after Accession in May 2004.

Local Currency Financing

In 2001 the Bank signed a PLN 3 bn Polish Zloty Debt Issuance programme paving the way for it to issue bonds on the domestic market. The EIB is now the biggest issuer in PLN after the Polish Government. Together with the PLN Treasury established by the Bank and the fall in interest rates, the Bank has seen an increased demand for loans in Polish Zloty of maturities characteristic of EIB lending. The Bank will increasingly therefore provide domestic currency on appropriate terms for projects in Poland.