The EIB's President, Philippe Maystadt, confirmed today that the EIB will contribute to the significant financial aid package communicated today by the President of the European Commission, José Manuel Barroso, for the reconstruction of tsunami hit areas of South East Asia.
The Bank is willing and ready to launch as quickly as possible a long-term lending programme for financing the reconstruction at favourable terms. The lending programme could be for an amount of up to EUR 1 billion. To keep the financial burden to the recipient countries as low as possible, the EIB foresees providing loans with a long duration of up to 30 years and with a 7 years grace period free of capital repayments. In addition it will look into the possibility to reduce further the financial burden by either combining EIB loans with EU grant aid or by granting an interest rate subsidy with EU budget funds. The lending program would be implemented in close coordination with the Commission, the World Bank and the Asian Development Bank.
The European Investment Bank is the European Union's long-term finance institution, directly owned by the Member States. The Bank's remit is to support EU policy objectives by financing economically viable investment. Some 96 percent of the EIB's activity is within the European Union. Outside of the EU, the EIB supports the EU's development and co-operation policies. In 2004. the EIB lent EUR 45 billion.
The EIB has a particular expertise in the assessment and support of projects, such as water supply and urban infrastructure, energy and transport infrastructure. The proposed reconstruction programme would finance projects in these sectors. To ensure quality, projects considered for financing will be appraised thoroughly by EIB experts as to their economic, technical and environmental viability, and the Bank will also insist on competitive tendering for building contracts.