On 5 December in Lyon, Mr Jean-Jack Queyranne, President of the Rhône-Alpes Regional Council and Mr Philippe de Fontaine Vive, Vice-President of the European Investment Bank (EIB) concluded a EUR 200 million financing agreement to help the Region replace and expand its existing rail fleet.

This project forms part of a series of investments undertaken by the Rhône-Alpes Region designed to respond to sustained growth in demand for rail transport by improving the service provided to users.

The EIB loan will be used to purchase new generation rolling stock, i.e. 75 motor-coach trains and 11 trailer units, which will replace old equipment and expand the fleet. These new regional express trains will be deployed by SNCF until 2009 on busy lines serving in particular St Etienne, Valence and Roanne as well as on sections forming part of trans-European networks (TENs).

This new loan underlines the EIB's support for the development of trans-European transport networks (TENs), especially railways. It is also in line with the European Union's policy of enhancing the attractiveness of rail versus road transport, thereby contributing to a reduction in pollution and road accidents.

The EIB's involvement as a financial partner in this project will enable the Region to diversify the borrowings required to finance its investment programme, on the keenest interest rate and maturity terms. At the signing ceremony, Philippe de Fontaine Vive stressed the EIB's commitment to supporting regional infrastructure projects, including the regionalisation of transport and the comprehensive establishment of TGV networks.

Philippe de Fontaine Vive added that he was pleased to be back in Lyon for the third time this year to provide support for a project affecting people's quality of life through its environmental dimension.

In 2005, the EIB has concluded major financing agreements for water and wastewater treatment in the conurbation (totalling EUR 150 million) and for the modernisation and extension of the tramway network (EUR 200 million). With the addition of previous loans in support of health sector (modernisation of Lyon's hospitals), infrastructure (Mont Blanc tunnel, Lyon North ring road, Gerland district, Ecole Normale Supérieure) and private sector projects, the EIB has granted loans amounting to almost EUR 4.7 billion to economic and social players in the Rhône-Alpes Region.

As the leading source of bank finance for trans-European networks, the EIB devotes a substantial portion of its funding to rail transport, investing over EUR 21 billion in the EU in the past 10 years including EUR 1.8 billion in France for the construction of high-speed lines, upgrading of infrastructure and purchase of rolling stock.

The Rhône-Alpes Region is the third French region to benefit from EIB support for modernising regional rail transport since the enactment of the Urban Solidarity and Renewal Law, which transferred responsibility for the organisation of transport to the regions. The EIB granted loans of EUR 110 million to the Brittany Region in 2002 and EUR 50 million to the Champagne-Ardenne Region in 2004 to upgrade their regional express services.