The European Investment Bank (EIB) is providing its first USD 50 million global loan facility to support medium-sized investments in the Philippines to ABN AMRO Bank Inc. (Philippines). The facility will provide medium to long-term finance for investments featuring European Union (EU) interest.
The global loan will underpin the recent growth in investment activity in the Philippines. Private sector investors, specific sectors related to the on-going deregulation and regional and local investment programmes are eligible under the global loan.
Subsidiaries of EU companies, joint-ventures involving EU and Filipino companies or private and public companies implementing projects in line with the EU-Philippines cooperation policy may benefit. Among the latter are projects aiming at environmental and social improvements, communication infrastructure or the transfer of EU technology.
The funding will assist ABN AMRO Bank Inc. to cover its term funding requirements for capital expenditure investments in the sectors of commercial infrastructure, particularly power and water sectors, industry, agro-industry, and also investment in eligible health and urban development, tourism, and related services including leasing. The loan will assist in the promotion of EU foreign direct investment in the Philippines and will support local entrepreneurship and employment. The EIB funding will be particularly earmarked for Private sector corporates and public / private partnerships promoting EU-Philippines mutual interest.
The EIB now celebrates 10 years of activity in the Philippines. The first loan, signed in December 1994, was to Union Cement Company for the development of the Davao cement plant in Mindanao.
The loan is provided in the context of the EU co-operation policy with third countries. In Asia and Latin America (ALA), the EIB may lend up to EUR 2.48 billion during 2000-2006 to support capital investment projects.The EIB was set up in 1958 to finance investment furthering EU integration. It lends for regional development, infrastructure, energy, industry and environment. Outside the EU, the Bank contributes to the European development co-operation policy in some 130 countries in Central and Eastern Europe, the Balkans, the Mediterranean region, Africa, the Caribbean and the Pacific, Asia and Latin America.
In 2003, the EIB provided loans totalling EUR 42 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. The EIB can pass on to project promoters the excellent conditions it obtains on the markets. The EIB may finance up to 50 percent of project cost. On average it provides one third of the funding and co-finances investments with other institutions.