On this occasion, EIB Vice-President Eva Srejber stated today: "The lending provided in Lithuania today fits in with the broader measures announced by the EIB last December under the European Economic Recovery Package, including support for smaller companies and investment in the less well-off ‘convergence' regions of the European Union. These funds will strengthen the competitiveness of the Lithuanian economy and enhance the effective use of the EU grant funds allocated to the country. We are building on the excellent cooperation with the Lithuanian authorities and the banking sector, and joining forces with the European Commission to support a large number of projects that in view of their relatively small size might not have direct access to EIB financing. Our multipartite cooperation maximises the efficiency and impact of our action".
The EUR 1 132 million loan to the Republic of Lithuania for priority investments co-financed with EU funds in the period 2007-2013 was signed today by Ms Eva Srejber and Mr Algirdas Semeta, Lithuanian Minister of Finance, in Vilnius.
The operation is structured as a Framework Loan and will be used by the Lithuanian State for investments in priority areas identified in the National Strategic Reference Framework, through the co-financing of three Operational Programmes for the Development of Human Resources, for Economic Growth and for the Promotion of Cohesion. The EIB Framework Loan will also provide financial support for the completion by 2010 of six large water supply and wastewater treatment projects that were co-financed by the Cohesion Fund in the 2004-2006 programming period.
The EIB will also contribute to the real economy through smaller investments in Lithuania, by cooperating with AB DnB NORD Bankas, with a EUR 15 million loan for projects in industry, services and tourism, as well as schemes mounted by private and public bodies in the fields of environment, economic infrastructure, development of a knowledge-based economy, rational use of energy, health and education in Lithuania. This new loan follows on from a series of other loans totalling EUR 60 million over the 2005-2008 period in favour of Lithuania's banking sector, which were on-lent to SMEs and mid-caps.
In a separate initiative, the European Investment Fund (EIF), part of the EIB Group, signed with the Ministry of Economy and the Ministry of Finance a Funding Agreement for the establishment of a JEREMIE Holding Fund for a capital sum of EUR 80 million. On 4 March 2009, the same parties signed and amendment to this agreement enabling an expansion of the capital allocated to this initiative up to a maximum of EUR 290 million. Implementation activities are well advanced. For Lithuania, the Holding Fund is to be used to provide financing to SMEs through selected intermediaries as a result of EIF implementing four instruments: VC Fund, Business Angel Co-Investment Fund, Funded Risk Sharing Instrument for Banks and Portfolio Guarantees for Banks.
Background information
In the prevailing economic context, and in line with European Union decisions, the European Investment Bank Group, the banking group promoting European objectives, stepped up its activities in 2008, and lent a total of EUR 57.6bn for projects promoting the European Union's policy objectives. Finance for the EU-27 Member States represented 89% of its activities and amounted to EUR 51.5bn.
In the five-year period 2004-2007, the European Investment Bank provided a total of EUR 128m for projects in Lithuania in support of the Union's objectives and the Bank's priorities of economic and social cohesion, a competitive and innovative European economy, efficient and easily accessible trans-European transport and energy networks (TENs), support for small and medium-sized enterprises (SMEs) and environmental protection, but also those of conserving natural resources and improving the quality of life in urban areas, as well as the objectives of efficiency, diversification and security in the energy sector. Transport and financing of smaller private as well as municipal projects have been the EIB's primary areas of intervention in Lithuania for the last five years.
The Joint European Resources for Micro to Medium Enterprises initiative, known by the acronym JEREMIE, is an initiative of the European Commission's Directorate General for Regional Policy (DG Regio) and the EIB Group to enhance SME finance.